Correlation Between Haleon Plc and Lifecore Biomedical
Can any of the company-specific risk be diversified away by investing in both Haleon Plc and Lifecore Biomedical 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 Haleon Plc and Lifecore Biomedical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Haleon plc and Lifecore Biomedical, you can compare the effects of market volatilities on Haleon Plc and Lifecore Biomedical 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 Haleon Plc with a short position of Lifecore Biomedical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haleon Plc and Lifecore Biomedical.
Diversification Opportunities for Haleon Plc and Lifecore Biomedical
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Haleon and Lifecore is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Haleon plc and Lifecore Biomedical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lifecore Biomedical and Haleon Plc 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 Haleon plc are associated (or correlated) with Lifecore Biomedical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lifecore Biomedical has no effect on the direction of Haleon Plc i.e., Haleon Plc and Lifecore Biomedical go up and down completely randomly.
Pair Corralation between Haleon Plc and Lifecore Biomedical
Considering the 90-day investment horizon Haleon plc is expected to under-perform the Lifecore Biomedical. But the stock apears to be less risky and, when comparing its historical volatility, Haleon plc is 4.41 times less risky than Lifecore Biomedical. The stock trades about -0.19 of its potential returns per unit of risk. The Lifecore Biomedical is currently generating about 0.33 of returns per unit of risk over similar time horizon. If you would invest 562.00 in Lifecore Biomedical on August 28, 2024 and sell it today you would earn a total of 184.00 from holding Lifecore Biomedical or generate 32.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Haleon plc vs. Lifecore Biomedical
Performance |
| Timeline |
| Haleon plc |
| Lifecore Biomedical |
Haleon Plc and Lifecore Biomedical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Haleon Plc and Lifecore Biomedical
The main advantage of trading using opposite Haleon Plc and Lifecore Biomedical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haleon Plc position performs unexpectedly, Lifecore Biomedical 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 Lifecore Biomedical will offset losses from the drop in Lifecore Biomedical's long position.| Haleon Plc vs. Teva Pharma Industries | Haleon Plc vs. Bausch Health Companies | Haleon Plc vs. Zoetis Inc | Haleon Plc vs. Takeda Pharmaceutical Co |
| Lifecore Biomedical vs. Shuttle Pharmaceuticals | Lifecore Biomedical vs. Catalent | Lifecore Biomedical vs. Tilray Inc | Lifecore Biomedical vs. Kamada |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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