Correlation Between Leafly Holdings and Allstar Health
Can any of the company-specific risk be diversified away by investing in both Leafly Holdings and Allstar Health 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 Leafly Holdings and Allstar Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Leafly Holdings and Allstar Health Brands, you can compare the effects of market volatilities on Leafly Holdings and Allstar Health 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 Leafly Holdings with a short position of Allstar Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Leafly Holdings and Allstar Health.
Diversification Opportunities for Leafly Holdings and Allstar Health
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Leafly and Allstar is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Leafly Holdings and Allstar Health Brands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allstar Health Brands and Leafly 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 Leafly Holdings are associated (or correlated) with Allstar Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allstar Health Brands has no effect on the direction of Leafly Holdings i.e., Leafly Holdings and Allstar Health go up and down completely randomly.
Pair Corralation between Leafly Holdings and Allstar Health
Assuming the 90 days horizon Leafly Holdings is expected to generate 2.38 times more return on investment than Allstar Health. However, Leafly Holdings is 2.38 times more volatile than Allstar Health Brands. It trades about -0.11 of its potential returns per unit of risk. Allstar Health Brands is currently generating about -0.32 per unit of risk. If you would invest 3.79 in Leafly Holdings on August 28, 2024 and sell it today you would lose (1.21) from holding Leafly Holdings or give up 31.93% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Leafly Holdings vs. Allstar Health Brands
Performance |
| Timeline |
| Leafly Holdings |
| Allstar Health Brands |
Leafly Holdings and Allstar Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Leafly Holdings and Allstar Health
The main advantage of trading using opposite Leafly Holdings and Allstar Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Leafly Holdings position performs unexpectedly, Allstar Health 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 Allstar Health will offset losses from the drop in Allstar Health's long position.| Leafly Holdings vs. Leafly Holdings | Leafly Holdings vs. WM Technology | Leafly Holdings vs. Revelation Biosciences | Leafly Holdings vs. AEye Inc |
| Allstar Health vs. Indo Global Exchange | Allstar Health vs. TPT Global Tech | Allstar Health vs. Valiant Eagle | Allstar Health vs. Sixty Six Oilfield |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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