Correlation Between Lion One and Interactive Strength

Can any of the company-specific risk be diversified away by investing in both Lion One and Interactive Strength 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 Lion One and Interactive Strength into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Lion One Metals and Interactive Strength Common, you can compare the effects of market volatilities on Lion One and Interactive Strength 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 Lion One with a short position of Interactive Strength. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lion One and Interactive Strength.

Diversification Opportunities for Lion One and Interactive Strength

-0.29

Correlation Coefficient

Lion One  Interactive Strength

Very good diversification

The 3 months correlation between Lion and Interactive is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Lion One Metals and Interactive Strength Common in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Interactive Strength and Lion One 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 Lion One Metals are associated (or correlated) with Interactive Strength. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Interactive Strength has no effect on the direction of Lion One i.e., Lion One and Interactive Strength go up and down completely randomly.

Pair Corralation between Lion One and Interactive Strength

Assuming the 90 days horizon Lion One Metals is expected to generate 0.5 times more return on investment than Interactive Strength. However, Lion One Metals is 2.01 times less risky than Interactive Strength. It trades about 0.12 of its potential returns per unit of risk. Interactive Strength Common is currently generating about -0.05 per unit of risk. If you would invest  17.00  in Lion One Metals on December 27, 2024 and sell it today you would earn a total of  7.00  from holding Lion One Metals or generate 41.18% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Lion One Metals  vs.  Interactive Strength Common

Lion One Metals

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Lion One Metals are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak essential indicators, Lion One reported solid returns over the last few months and may actually be approaching a breakup point.

Interactive Strength

Risk-Adjusted Performance

Very Weak

Over the last 90 days Interactive Strength Common has generated negative risk-adjusted returns adding no value to investors with long positions. Even with fragile performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Lion One and Interactive Strength

The main advantage of trading using opposite Lion One and Interactive Strength positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lion One position performs unexpectedly, Interactive Strength 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 Interactive Strength will offset losses from the drop in Interactive Strength's long position.

The idea behind Lion One Metals and Interactive Strength Common 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.

Check out your portfolio center.

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 Global Correlations module to find global opportunities by holding instruments from different markets.