Correlation Between Lazydays Holdings and Kingsway Financial
Can any of the company-specific risk be diversified away by investing in both Lazydays Holdings and Kingsway Financial 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 Lazydays Holdings and Kingsway Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lazydays Holdings and Kingsway Financial Services, you can compare the effects of market volatilities on Lazydays Holdings and Kingsway Financial 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 Lazydays Holdings with a short position of Kingsway Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lazydays Holdings and Kingsway Financial.
Diversification Opportunities for Lazydays Holdings and Kingsway Financial
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Lazydays and Kingsway is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Lazydays Holdings and Kingsway Financial Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kingsway Financial and Lazydays Holdings 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 Lazydays Holdings are associated (or correlated) with Kingsway Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kingsway Financial has no effect on the direction of Lazydays Holdings i.e., Lazydays Holdings and Kingsway Financial go up and down completely randomly.
Pair Corralation between Lazydays Holdings and Kingsway Financial
Given the investment horizon of 90 days Lazydays Holdings is expected to generate 1.83 times more return on investment than Kingsway Financial. However, Lazydays Holdings is 1.83 times more volatile than Kingsway Financial Services. It trades about 0.05 of its potential returns per unit of risk. Kingsway Financial Services is currently generating about 0.01 per unit of risk. If you would invest 1,171 in Lazydays Holdings on August 31, 2024 and sell it today you would earn a total of 41.00 from holding Lazydays Holdings or generate 3.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 8.56% |
| Values | Daily Returns |
Lazydays Holdings vs. Kingsway Financial Services
Performance |
| Timeline |
| Lazydays Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Kingsway Financial |
Lazydays Holdings and Kingsway Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lazydays Holdings and Kingsway Financial
The main advantage of trading using opposite Lazydays Holdings and Kingsway Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lazydays Holdings position performs unexpectedly, Kingsway Financial 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 Kingsway Financial will offset losses from the drop in Kingsway Financial's long position.| Lazydays Holdings vs. Limbach Holdings | Lazydays Holdings vs. Clarus Corp | Lazydays Holdings vs. Onewater Marine | Lazydays Holdings vs. One Group Hospitality |
| Kingsway Financial vs. CarGurus | Kingsway Financial vs. KAR Auction Services | Kingsway Financial vs. Driven Brands Holdings | Kingsway Financial vs. Group 1 Automotive |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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