Correlation Between KVH Industries and Life Time
Can any of the company-specific risk be diversified away by investing in both KVH Industries and Life Time 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 KVH Industries and Life Time into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KVH Industries and Life Time Group, you can compare the effects of market volatilities on KVH Industries and Life Time 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 KVH Industries with a short position of Life Time. Check out your portfolio center. Please also check ongoing floating volatility patterns of KVH Industries and Life Time.
Diversification Opportunities for KVH Industries and Life Time
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between KVH and Life is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding KVH Industries and Life Time Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Life Time Group and KVH Industries 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 KVH Industries are associated (or correlated) with Life Time. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Life Time Group has no effect on the direction of KVH Industries i.e., KVH Industries and Life Time go up and down completely randomly.
Pair Corralation between KVH Industries and Life Time
Given the investment horizon of 90 days KVH Industries is expected to generate 1.84 times less return on investment than Life Time. In addition to that, KVH Industries is 1.15 times more volatile than Life Time Group. It trades about 0.06 of its total potential returns per unit of risk. Life Time Group is currently generating about 0.13 per unit of volatility. If you would invest 1,750 in Life Time Group on September 5, 2024 and sell it today you would earn a total of 662.00 from holding Life Time Group or generate 37.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
KVH Industries vs. Life Time Group
Performance |
| Timeline |
| KVH Industries |
| Life Time Group |
KVH Industries and Life Time Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KVH Industries and Life Time
The main advantage of trading using opposite KVH Industries and Life Time positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KVH Industries position performs unexpectedly, Life Time 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 Life Time will offset losses from the drop in Life Time's long position.| KVH Industries vs. Cambium Networks Corp | KVH Industries vs. Knowles Cor | KVH Industries vs. Ituran Location and | KVH Industries vs. Aviat Networks |
| Life Time vs. Hyatt Hotels | Life Time vs. Smart Share Global | Life Time vs. Sweetgreen | Life Time vs. Wyndham Hotels Resorts |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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