Correlation Between Loews Corp and Better World
Can any of the company-specific risk be diversified away by investing in both Loews Corp and Better World 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 Loews Corp and Better World into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Loews Corp and Better World Acquisition, you can compare the effects of market volatilities on Loews Corp and Better World 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 Loews Corp with a short position of Better World. Check out your portfolio center. Please also check ongoing floating volatility patterns of Loews Corp and Better World.
Diversification Opportunities for Loews Corp and Better World
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Loews and Better is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Loews Corp and Better World Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Better World Acquisition and Loews Corp 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 Loews Corp are associated (or correlated) with Better World. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Better World Acquisition has no effect on the direction of Loews Corp i.e., Loews Corp and Better World go up and down completely randomly.
Pair Corralation between Loews Corp and Better World
If you would invest 1,002 in Better World Acquisition on October 25, 2024 and sell it today you would earn a total of 0.00 from holding Better World Acquisition or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 5.56% |
| Values | Daily Returns |
Loews Corp vs. Better World Acquisition
Performance |
| Timeline |
| Loews Corp |
| Better World Acquisition |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Loews Corp and Better World Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Loews Corp and Better World
The main advantage of trading using opposite Loews Corp and Better World positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Loews Corp position performs unexpectedly, Better World 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 Better World will offset losses from the drop in Better World's long position.| Loews Corp vs. Horace Mann Educators | Loews Corp vs. Global Indemnity PLC | Loews Corp vs. Selective Insurance Group | Loews Corp vs. Kemper |
| Better World vs. Khiron Life Sciences | Better World vs. Energy and Environmental | Better World vs. The Andersons | Better World vs. Gfl Environmental Holdings |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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