Correlation Between Expand Energy and Lexaria Bioscience
Can any of the company-specific risk be diversified away by investing in both Expand Energy and Lexaria Bioscience 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 Expand Energy and Lexaria Bioscience into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Expand Energy and Lexaria Bioscience Corp, you can compare the effects of market volatilities on Expand Energy and Lexaria Bioscience 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 Expand Energy with a short position of Lexaria Bioscience. Check out your portfolio center. Please also check ongoing floating volatility patterns of Expand Energy and Lexaria Bioscience.
Diversification Opportunities for Expand Energy and Lexaria Bioscience
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Expand and Lexaria is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Expand Energy and Lexaria Bioscience Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lexaria Bioscience Corp and Expand Energy 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 Expand Energy are associated (or correlated) with Lexaria Bioscience. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lexaria Bioscience Corp has no effect on the direction of Expand Energy i.e., Expand Energy and Lexaria Bioscience go up and down completely randomly.
Pair Corralation between Expand Energy and Lexaria Bioscience
Assuming the 90 days horizon Expand Energy is expected to generate 1.79 times less return on investment than Lexaria Bioscience. But when comparing it to its historical volatility, Expand Energy is 3.53 times less risky than Lexaria Bioscience. It trades about 0.1 of its potential returns per unit of risk. Lexaria Bioscience Corp is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 150.00 in Lexaria Bioscience Corp on October 24, 2024 and sell it today you would earn a total of 48.00 from holding Lexaria Bioscience Corp or generate 32.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Expand Energy vs. Lexaria Bioscience Corp
Performance |
| Timeline |
| Expand Energy |
| Lexaria Bioscience Corp |
Expand Energy and Lexaria Bioscience Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Expand Energy and Lexaria Bioscience
The main advantage of trading using opposite Expand Energy and Lexaria Bioscience positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Expand Energy position performs unexpectedly, Lexaria Bioscience 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 Lexaria Bioscience will offset losses from the drop in Lexaria Bioscience's long position.| Expand Energy vs. NETGEAR | Expand Energy vs. IPG Photonics | Expand Energy vs. Yuexiu Transport Infrastructure | Expand Energy vs. United Microelectronics |
| Lexaria Bioscience vs. Revelation Biosciences | Lexaria Bioscience vs. Zura Bio Limited | Lexaria Bioscience vs. Phio Pharmaceuticals Corp | Lexaria Bioscience vs. ZyVersa Therapeutics |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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