Correlation Between Anheuser Busch and Lifevantage
Can any of the company-specific risk be diversified away by investing in both Anheuser Busch and Lifevantage 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 Anheuser Busch and Lifevantage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Anheuser Busch Inbev and Lifevantage, you can compare the effects of market volatilities on Anheuser Busch and Lifevantage 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 Anheuser Busch with a short position of Lifevantage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anheuser Busch and Lifevantage.
Diversification Opportunities for Anheuser Busch and Lifevantage
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Anheuser and Lifevantage is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Anheuser Busch Inbev and Lifevantage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lifevantage and Anheuser Busch 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 Anheuser Busch Inbev are associated (or correlated) with Lifevantage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lifevantage has no effect on the direction of Anheuser Busch i.e., Anheuser Busch and Lifevantage go up and down completely randomly.
Pair Corralation between Anheuser Busch and Lifevantage
Considering the 90-day investment horizon Anheuser Busch Inbev is expected to under-perform the Lifevantage. But the stock apears to be less risky and, when comparing its historical volatility, Anheuser Busch Inbev is 3.34 times less risky than Lifevantage. The stock trades about -0.46 of its potential returns per unit of risk. The Lifevantage is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 1,300 in Lifevantage on September 2, 2024 and sell it today you would earn a total of 161.00 from holding Lifevantage or generate 12.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Anheuser Busch Inbev vs. Lifevantage
Performance |
| Timeline |
| Anheuser Busch Inbev |
| Lifevantage |
Anheuser Busch and Lifevantage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anheuser Busch and Lifevantage
The main advantage of trading using opposite Anheuser Busch and Lifevantage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anheuser Busch position performs unexpectedly, Lifevantage 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 Lifevantage will offset losses from the drop in Lifevantage's long position.| Anheuser Busch vs. Boston Beer | Anheuser Busch vs. Molson Coors Beverage | Anheuser Busch vs. Heineken NV | Anheuser Busch vs. Ambev SA ADR |
| Lifevantage vs. Seneca Foods Corp | Lifevantage vs. Central Garden Pet | Lifevantage vs. Central Garden Pet | Lifevantage vs. Lifeway Foods |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Commodity Directory Find actively traded commodities issued by global exchanges |