Correlation Between LIFENET INSURANCE and Equifax
Can any of the company-specific risk be diversified away by investing in both LIFENET INSURANCE and Equifax 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 LIFENET INSURANCE and Equifax into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LIFENET INSURANCE CO and Equifax, you can compare the effects of market volatilities on LIFENET INSURANCE and Equifax 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 LIFENET INSURANCE with a short position of Equifax. Check out your portfolio center. Please also check ongoing floating volatility patterns of LIFENET INSURANCE and Equifax.
Diversification Opportunities for LIFENET INSURANCE and Equifax
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between LIFENET and Equifax is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding LIFENET INSURANCE CO and Equifax in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Equifax and LIFENET INSURANCE 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 LIFENET INSURANCE CO are associated (or correlated) with Equifax. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Equifax has no effect on the direction of LIFENET INSURANCE i.e., LIFENET INSURANCE and Equifax go up and down completely randomly.
Pair Corralation between LIFENET INSURANCE and Equifax
Assuming the 90 days horizon LIFENET INSURANCE CO is expected to generate 1.9 times more return on investment than Equifax. However, LIFENET INSURANCE is 1.9 times more volatile than Equifax. It trades about 0.1 of its potential returns per unit of risk. Equifax is currently generating about 0.08 per unit of risk. If you would invest 855.00 in LIFENET INSURANCE CO on September 1, 2024 and sell it today you would earn a total of 375.00 from holding LIFENET INSURANCE CO or generate 43.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.24% |
| Values | Daily Returns |
LIFENET INSURANCE CO vs. Equifax
Performance |
| Timeline |
| LIFENET INSURANCE |
| Equifax |
LIFENET INSURANCE and Equifax Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LIFENET INSURANCE and Equifax
The main advantage of trading using opposite LIFENET INSURANCE and Equifax positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LIFENET INSURANCE position performs unexpectedly, Equifax 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 Equifax will offset losses from the drop in Equifax's long position.| LIFENET INSURANCE vs. Fukuyama Transporting Co | LIFENET INSURANCE vs. Sporttotal AG | LIFENET INSURANCE vs. COLUMBIA SPORTSWEAR | LIFENET INSURANCE vs. ADRIATIC METALS LS 013355 |
| Equifax vs. HOCHSCHILD MINING | Equifax vs. HANOVER INSURANCE | Equifax vs. Zurich Insurance Group | Equifax vs. TSOGO SUN GAMING |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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