Correlation Between Leafly Holdings and Bimi International
Can any of the company-specific risk be diversified away by investing in both Leafly Holdings and Bimi International 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 Bimi International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Leafly Holdings and Bimi International Medical, you can compare the effects of market volatilities on Leafly Holdings and Bimi International 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 Bimi International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Leafly Holdings and Bimi International.
Diversification Opportunities for Leafly Holdings and Bimi International
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Leafly and Bimi is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Leafly Holdings and Bimi International Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bimi International 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 Bimi International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bimi International has no effect on the direction of Leafly Holdings i.e., Leafly Holdings and Bimi International go up and down completely randomly.
Pair Corralation between Leafly Holdings and Bimi International
Assuming the 90 days horizon Leafly Holdings is expected to generate 6.09 times more return on investment than Bimi International. However, Leafly Holdings is 6.09 times more volatile than Bimi International Medical. It trades about 0.11 of its potential returns per unit of risk. Bimi International Medical is currently generating about -0.04 per unit of risk. If you would invest 2.05 in Leafly Holdings on August 24, 2024 and sell it today you would earn a total of 0.54 from holding Leafly Holdings or generate 26.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 84.58% |
| Values | Daily Returns |
Leafly Holdings vs. Bimi International Medical
Performance |
| Timeline |
| Leafly Holdings |
| Bimi International |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Leafly Holdings and Bimi International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Leafly Holdings and Bimi International
The main advantage of trading using opposite Leafly Holdings and Bimi International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Leafly Holdings position performs unexpectedly, Bimi International 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 Bimi International will offset losses from the drop in Bimi International's long position.| Leafly Holdings vs. Leafly Holdings | Leafly Holdings vs. WM Technology | Leafly Holdings vs. Revelation Biosciences | Leafly Holdings vs. AEye Inc |
| Bimi International vs. PetMed Express | Bimi International vs. Leafly Holdings | Bimi International vs. Allstar Health Brands | Bimi International vs. SunLink Health Systems |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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