Correlation Between COMINTL BANK and Lifeway Foods
Can any of the company-specific risk be diversified away by investing in both COMINTL BANK and Lifeway Foods 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 COMINTL BANK and Lifeway Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COMINTL BANK ADR1 and Lifeway Foods, you can compare the effects of market volatilities on COMINTL BANK and Lifeway Foods 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 COMINTL BANK with a short position of Lifeway Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of COMINTL BANK and Lifeway Foods.
Diversification Opportunities for COMINTL BANK and Lifeway Foods
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between COMINTL and Lifeway is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding COMINTL BANK ADR1 and Lifeway Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lifeway Foods and COMINTL BANK 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 COMINTL BANK ADR1 are associated (or correlated) with Lifeway Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lifeway Foods has no effect on the direction of COMINTL BANK i.e., COMINTL BANK and Lifeway Foods go up and down completely randomly.
Pair Corralation between COMINTL BANK and Lifeway Foods
Assuming the 90 days trading horizon COMINTL BANK is expected to generate 3.57 times less return on investment than Lifeway Foods. But when comparing it to its historical volatility, COMINTL BANK ADR1 is 2.13 times less risky than Lifeway Foods. It trades about 0.04 of its potential returns per unit of risk. Lifeway Foods is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 985.00 in Lifeway Foods on November 28, 2024 and sell it today you would earn a total of 1,015 from holding Lifeway Foods or generate 103.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.7% |
| Values | Daily Returns |
COMINTL BANK ADR1 vs. Lifeway Foods
Performance |
| Timeline |
| COMINTL BANK ADR1 |
| Lifeway Foods |
COMINTL BANK and Lifeway Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COMINTL BANK and Lifeway Foods
The main advantage of trading using opposite COMINTL BANK and Lifeway Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COMINTL BANK position performs unexpectedly, Lifeway Foods 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 Lifeway Foods will offset losses from the drop in Lifeway Foods' long position.| COMINTL BANK vs. alstria office REIT AG | COMINTL BANK vs. Infrastrutture Wireless Italiane | COMINTL BANK vs. 24SEVENOFFICE GROUP AB | COMINTL BANK vs. WILLIS LEASE FIN |
| Lifeway Foods vs. Gol Intelligent Airlines | Lifeway Foods vs. PennantPark Investment | Lifeway Foods vs. United Airlines Holdings | Lifeway Foods vs. Japan Asia Investment |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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