Correlation Between LOBO EV and Biglari Holdings

Can any of the company-specific risk be diversified away by investing in both LOBO EV and Biglari Holdings at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining LOBO EV and Biglari Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between LOBO EV TECHNOLOGIES and Biglari Holdings, you can compare the effects of market volatilities on LOBO EV and Biglari Holdings and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in LOBO EV with a short position of Biglari Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of LOBO EV and Biglari Holdings.

Diversification Opportunities for LOBO EV and Biglari Holdings

0.31

Correlation Coefficient

LOBO EV  Biglari Holdings

Weak diversification

The 3 months correlation between LOBO and Biglari is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding LOBO EV TECHNOLOGIES and Biglari Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Biglari Holdings and LOBO EV is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on LOBO EV TECHNOLOGIES are associated (or correlated) with Biglari Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Biglari Holdings has no effect on the direction of LOBO EV i.e., LOBO EV and Biglari Holdings go up and down completely randomly.

Pair Corralation between LOBO EV and Biglari Holdings

Given the investment horizon of 90 days LOBO EV TECHNOLOGIES is expected to under-perform the Biglari Holdings. In addition to that, LOBO EV is 1.97 times more volatile than Biglari Holdings. It trades about -0.17 of its total potential returns per unit of risk. Biglari Holdings is currently generating about -0.12 per unit of volatility. If you would invest  25,600  in Biglari Holdings on December 28, 2024 and sell it today you would lose (4,460) from holding Biglari Holdings or give up 17.42% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

LOBO EV TECHNOLOGIES  vs.  Biglari Holdings

LOBO EV TECHNOLOGIES

Risk-Adjusted Performance

Very Weak

Over the last 90 days LOBO EV TECHNOLOGIES has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's fundamental drivers remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Biglari Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days Biglari Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's technical indicators remain fairly strong which may send shares a bit higher in April 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pair Trading with LOBO EV and Biglari Holdings

The main advantage of trading using opposite LOBO EV and Biglari Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LOBO EV position performs unexpectedly, Biglari Holdings can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Biglari Holdings will offset losses from the drop in Biglari Holdings' long position.

The idea behind LOBO EV TECHNOLOGIES and Biglari Holdings pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.