Correlation Between Lifecore Biomedical and Tilray
Can any of the company-specific risk be diversified away by investing in both Lifecore Biomedical and Tilray 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 Lifecore Biomedical and Tilray into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lifecore Biomedical and Tilray Inc, you can compare the effects of market volatilities on Lifecore Biomedical and Tilray 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 Lifecore Biomedical with a short position of Tilray. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lifecore Biomedical and Tilray.
Diversification Opportunities for Lifecore Biomedical and Tilray
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Lifecore and Tilray is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Lifecore Biomedical and Tilray Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tilray Inc and Lifecore Biomedical 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 Lifecore Biomedical are associated (or correlated) with Tilray. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tilray Inc has no effect on the direction of Lifecore Biomedical i.e., Lifecore Biomedical and Tilray go up and down completely randomly.
Pair Corralation between Lifecore Biomedical and Tilray
Given the investment horizon of 90 days Lifecore Biomedical is expected to generate 1.04 times more return on investment than Tilray. However, Lifecore Biomedical is 1.04 times more volatile than Tilray Inc. It trades about 0.33 of its potential returns per unit of risk. Tilray Inc is currently generating about -0.2 per unit of risk. 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 | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lifecore Biomedical vs. Tilray Inc
Performance |
| Timeline |
| Lifecore Biomedical |
| Tilray Inc |
Lifecore Biomedical and Tilray Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lifecore Biomedical and Tilray
The main advantage of trading using opposite Lifecore Biomedical and Tilray positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lifecore Biomedical position performs unexpectedly, Tilray 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 Tilray will offset losses from the drop in Tilray's long position.| 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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