Correlation Between Lifeway Foods and DBS Group
Can any of the company-specific risk be diversified away by investing in both Lifeway Foods and DBS Group 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 Lifeway Foods and DBS Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lifeway Foods and DBS Group Holdings, you can compare the effects of market volatilities on Lifeway Foods and DBS Group 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 Lifeway Foods with a short position of DBS Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lifeway Foods and DBS Group.
Diversification Opportunities for Lifeway Foods and DBS Group
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Lifeway and DBS is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Lifeway Foods and DBS Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DBS Group Holdings and Lifeway Foods 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 Lifeway Foods are associated (or correlated) with DBS Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DBS Group Holdings has no effect on the direction of Lifeway Foods i.e., Lifeway Foods and DBS Group go up and down completely randomly.
Pair Corralation between Lifeway Foods and DBS Group
Assuming the 90 days horizon Lifeway Foods is expected to under-perform the DBS Group. In addition to that, Lifeway Foods is 2.53 times more volatile than DBS Group Holdings. It trades about -0.02 of its total potential returns per unit of risk. DBS Group Holdings is currently generating about 0.19 per unit of volatility. If you would invest 2,700 in DBS Group Holdings on August 29, 2024 and sell it today you would earn a total of 245.00 from holding DBS Group Holdings or generate 9.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Lifeway Foods vs. DBS Group Holdings
Performance |
| Timeline |
| Lifeway Foods |
| DBS Group Holdings |
Lifeway Foods and DBS Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lifeway Foods and DBS Group
The main advantage of trading using opposite Lifeway Foods and DBS Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lifeway Foods position performs unexpectedly, DBS Group 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 DBS Group will offset losses from the drop in DBS Group's long position.| Lifeway Foods vs. BE Semiconductor Industries | Lifeway Foods vs. Fast Retailing Co | Lifeway Foods vs. ELMOS SEMICONDUCTOR | Lifeway Foods vs. Carsales |
| DBS Group vs. Cleanaway Waste Management | DBS Group vs. Pebblebrook Hotel Trust | DBS Group vs. COFCO Joycome Foods | DBS Group vs. Lifeway Foods |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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