Correlation Between KROGER and Live Ventures

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

By analyzing existing cross correlation between KROGER 54 percent and Live Ventures, you can compare the effects of market volatilities on KROGER and Live Ventures 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 KROGER with a short position of Live Ventures. Check out your portfolio center. Please also check ongoing floating volatility patterns of KROGER and Live Ventures.

Diversification Opportunities for KROGER and Live Ventures

-0.21

Correlation Coefficient

KROGER  Live Ventures

Very good diversification

The 3 months correlation between KROGER and Live is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding KROGER 54 percent and Live Ventures in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Live Ventures and KROGER 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 KROGER 54 percent are associated (or correlated) with Live Ventures. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Live Ventures has no effect on the direction of KROGER i.e., KROGER and Live Ventures go up and down completely randomly.

Pair Corralation between KROGER and Live Ventures

Assuming the 90 days trading horizon KROGER 54 percent is expected to generate 0.25 times more return on investment than Live Ventures. However, KROGER 54 percent is 3.93 times less risky than Live Ventures. It trades about -0.03 of its potential returns per unit of risk. Live Ventures is currently generating about -0.24 per unit of risk. If you would invest  9,755  in KROGER 54 percent on December 4, 2024 and sell it today you would lose (41.00) from holding KROGER 54 percent or give up 0.42% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	70.0%
Values	Daily Returns

KROGER 54 percent  vs.  Live Ventures

KROGER 54 percent

Risk-Adjusted Performance

Very Weak

Over the last 90 days KROGER 54 percent has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, KROGER is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Live Ventures

Risk-Adjusted Performance

Very Weak

Over the last 90 days Live Ventures has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with KROGER and Live Ventures

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

The idea behind KROGER 54 percent and Live Ventures 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.