Correlation Between Lifevantage and Village Super
Can any of the company-specific risk be diversified away by investing in both Lifevantage and Village Super 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 Village Super into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lifevantage and Village Super Market, you can compare the effects of market volatilities on Lifevantage and Village Super 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 Village Super. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lifevantage and Village Super.
Diversification Opportunities for Lifevantage and Village Super
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Lifevantage and Village is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Lifevantage and Village Super Market in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Village Super Market 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 Village Super. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Village Super Market has no effect on the direction of Lifevantage i.e., Lifevantage and Village Super go up and down completely randomly.
Pair Corralation between Lifevantage and Village Super
Given the investment horizon of 90 days Lifevantage is expected to generate 2.37 times less return on investment than Village Super. In addition to that, Lifevantage is 1.1 times more volatile than Village Super Market. It trades about 0.05 of its total potential returns per unit of risk. Village Super Market is currently generating about 0.13 per unit of volatility. If you would invest 2,986 in Village Super Market on August 27, 2024 and sell it today you would earn a total of 252.00 from holding Village Super Market or generate 8.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lifevantage vs. Village Super Market
Performance |
| Timeline |
| Lifevantage |
| Village Super Market |
Lifevantage and Village Super Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lifevantage and Village Super
The main advantage of trading using opposite Lifevantage and Village Super positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lifevantage position performs unexpectedly, Village Super 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 Village Super will offset losses from the drop in Village Super's long position.| Lifevantage vs. Seneca Foods Corp | Lifevantage vs. Central Garden Pet | Lifevantage vs. Central Garden Pet | Lifevantage vs. Lifeway Foods |
| Village Super vs. Innovative Food Hldg | Village Super vs. Calavo Growers | Village Super vs. The Chefs Warehouse | Village Super vs. AMCON Distributing |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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