Correlation Between Live Ventures and Burlington Stores
Can any of the company-specific risk be diversified away by investing in both Live Ventures and Burlington Stores 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 Live Ventures and Burlington Stores into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Live Ventures and Burlington Stores, you can compare the effects of market volatilities on Live Ventures and Burlington Stores 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 Live Ventures with a short position of Burlington Stores. Check out your portfolio center. Please also check ongoing floating volatility patterns of Live Ventures and Burlington Stores.
Diversification Opportunities for Live Ventures and Burlington Stores
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Live and Burlington is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Live Ventures and Burlington Stores in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Burlington Stores and Live Ventures 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 Live Ventures are associated (or correlated) with Burlington Stores. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Burlington Stores has no effect on the direction of Live Ventures i.e., Live Ventures and Burlington Stores go up and down completely randomly.
Pair Corralation between Live Ventures and Burlington Stores
Given the investment horizon of 90 days Live Ventures is expected to under-perform the Burlington Stores. In addition to that, Live Ventures is 1.77 times more volatile than Burlington Stores. It trades about -0.11 of its total potential returns per unit of risk. Burlington Stores is currently generating about -0.17 per unit of volatility. If you would invest 28,480 in Burlington Stores on November 30, 2024 and sell it today you would lose (3,547) from holding Burlington Stores or give up 12.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Live Ventures vs. Burlington Stores
Performance |
| Timeline |
| Live Ventures |
| Burlington Stores |
Live Ventures and Burlington Stores Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Live Ventures and Burlington Stores
The main advantage of trading using opposite Live Ventures and Burlington Stores positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Live Ventures position performs unexpectedly, Burlington Stores 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 Burlington Stores will offset losses from the drop in Burlington Stores' long position.| Live Ventures vs. Arhaus Inc | Live Ventures vs. Floor Decor Holdings | Live Ventures vs. Haverty Furniture Companies | Live Ventures vs. Kingfisher plc |
| Burlington Stores vs. The TJX Companies | Burlington Stores vs. Guess Inc | Burlington Stores vs. Urban Outfitters | Burlington Stores vs. Childrens Place |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
Other Complementary Tools
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios |