Correlation Between Life Time and Intchains Group
Can any of the company-specific risk be diversified away by investing in both Life Time and Intchains Group 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 Life Time and Intchains Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Life Time Group and Intchains Group Limited, you can compare the effects of market volatilities on Life Time and Intchains Group 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 Life Time with a short position of Intchains Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Life Time and Intchains Group.
Diversification Opportunities for Life Time and Intchains Group
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Life and Intchains is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Life Time Group and Intchains Group Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intchains Group and Life Time 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 Life Time Group are associated (or correlated) with Intchains Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intchains Group has no effect on the direction of Life Time i.e., Life Time and Intchains Group go up and down completely randomly.
Pair Corralation between Life Time and Intchains Group
Considering the 90-day investment horizon Life Time Group is expected to under-perform the Intchains Group. But the stock apears to be less risky and, when comparing its historical volatility, Life Time Group is 11.26 times less risky than Intchains Group. The stock trades about -0.27 of its potential returns per unit of risk. The Intchains Group Limited is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 431.00 in Intchains Group Limited on September 24, 2024 and sell it today you would earn a total of 446.00 from holding Intchains Group Limited or generate 103.48% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Life Time Group vs. Intchains Group Limited
Performance |
Timeline |
Life Time Group |
Intchains Group |
Life Time and Intchains Group Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Life Time and Intchains Group
The main advantage of trading using opposite Life Time and Intchains Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Life Time position performs unexpectedly, Intchains Group 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 Intchains Group will offset losses from the drop in Intchains Group's long position.Life Time vs. Bowlero Corp | Life Time vs. Planet Fitness | Life Time vs. JAKKS Pacific | Life Time vs. Xponential Fitness |
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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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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