Correlation Between Lifevantage and Boyd Gaming
Can any of the company-specific risk be diversified away by investing in both Lifevantage and Boyd Gaming 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 Lifevantage and Boyd Gaming into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lifevantage and Boyd Gaming, you can compare the effects of market volatilities on Lifevantage and Boyd Gaming 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 Lifevantage with a short position of Boyd Gaming. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lifevantage and Boyd Gaming.
Diversification Opportunities for Lifevantage and Boyd Gaming
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Lifevantage and Boyd is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Lifevantage and Boyd Gaming in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boyd Gaming and Lifevantage 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 Lifevantage are associated (or correlated) with Boyd Gaming. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boyd Gaming has no effect on the direction of Lifevantage i.e., Lifevantage and Boyd Gaming go up and down completely randomly.
Pair Corralation between Lifevantage and Boyd Gaming
Given the investment horizon of 90 days Lifevantage is expected to generate 3.02 times more return on investment than Boyd Gaming. However, Lifevantage is 3.02 times more volatile than Boyd Gaming. It trades about 0.14 of its potential returns per unit of risk. Boyd Gaming is currently generating about 0.08 per unit of risk. If you would invest 1,298 in Lifevantage on August 30, 2024 and sell it today you would earn a total of 142.00 from holding Lifevantage or generate 10.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lifevantage vs. Boyd Gaming
Performance |
| Timeline |
| Lifevantage |
| Boyd Gaming |
Lifevantage and Boyd Gaming Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lifevantage and Boyd Gaming
The main advantage of trading using opposite Lifevantage and Boyd Gaming positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lifevantage position performs unexpectedly, Boyd Gaming 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 Boyd Gaming will offset losses from the drop in Boyd Gaming's long position.| Lifevantage vs. Seneca Foods Corp | Lifevantage vs. Central Garden Pet | Lifevantage vs. Central Garden Pet | Lifevantage vs. Lifeway Foods |
| Boyd Gaming vs. MGM Resorts International | Boyd Gaming vs. Las Vegas Sands | Boyd Gaming vs. Wynn Resorts Limited | Boyd Gaming vs. Penn National Gaming |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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