Correlation Between Li-FT Power and Natural Health
Can any of the company-specific risk be diversified away by investing in both Li-FT Power and Natural Health 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 Li-FT Power and Natural Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Li FT Power and Natural Health Trends, you can compare the effects of market volatilities on Li-FT Power and Natural Health 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 Li-FT Power with a short position of Natural Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Li-FT Power and Natural Health.
Diversification Opportunities for Li-FT Power and Natural Health
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Li-FT and Natural is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Li FT Power and Natural Health Trends in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Natural Health Trends and Li-FT Power 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 Li FT Power are associated (or correlated) with Natural Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Natural Health Trends has no effect on the direction of Li-FT Power i.e., Li-FT Power and Natural Health go up and down completely randomly.
Pair Corralation between Li-FT Power and Natural Health
Assuming the 90 days horizon Li FT Power is expected to under-perform the Natural Health. In addition to that, Li-FT Power is 2.0 times more volatile than Natural Health Trends. It trades about -0.06 of its total potential returns per unit of risk. Natural Health Trends is currently generating about 0.07 per unit of volatility. If you would invest 433.00 in Natural Health Trends on December 5, 2024 and sell it today you would earn a total of 33.00 from holding Natural Health Trends or generate 7.62% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 97.67% |
Values | Daily Returns |
Li FT Power vs. Natural Health Trends
Performance |
Timeline |
Li FT Power |
Natural Health Trends |
Li-FT Power and Natural Health Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Li-FT Power and Natural Health
The main advantage of trading using opposite Li-FT Power and Natural Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Li-FT Power position performs unexpectedly, Natural Health 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 Natural Health will offset losses from the drop in Natural Health's long position.Li-FT Power vs. MAVEN WIRELESS SWEDEN | Li-FT Power vs. GUILD ESPORTS PLC | Li-FT Power vs. SOEDER SPORTFISKE AB | Li-FT Power vs. CITY OFFICE REIT |
Natural Health vs. Pets at Home | Natural Health vs. EMPEROR ENT HOTEL | Natural Health vs. Dalata Hotel Group | Natural Health vs. MELIA HOTELS |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
Other Complementary Tools
Positions Ratings 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 | |
Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
Economic Indicators Top statistical indicators that provide insights into how an economy is performing |