Correlation Between Lifeway Foods and Jiangsu Expressway
Can any of the company-specific risk be diversified away by investing in both Lifeway Foods and Jiangsu Expressway 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 Jiangsu Expressway into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lifeway Foods and Jiangsu Expressway, you can compare the effects of market volatilities on Lifeway Foods and Jiangsu Expressway 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 Jiangsu Expressway. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lifeway Foods and Jiangsu Expressway.
Diversification Opportunities for Lifeway Foods and Jiangsu Expressway
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lifeway and Jiangsu is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Lifeway Foods and Jiangsu Expressway in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangsu Expressway 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 Jiangsu Expressway. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangsu Expressway has no effect on the direction of Lifeway Foods i.e., Lifeway Foods and Jiangsu Expressway go up and down completely randomly.
Pair Corralation between Lifeway Foods and Jiangsu Expressway
Assuming the 90 days horizon Lifeway Foods is expected to under-perform the Jiangsu Expressway. In addition to that, Lifeway Foods is 6.79 times more volatile than Jiangsu Expressway. It trades about -0.02 of its total potential returns per unit of risk. Jiangsu Expressway is currently generating about 0.07 per unit of volatility. If you would invest 89.00 in Jiangsu Expressway on September 2, 2024 and sell it today you would earn a total of 1.00 from holding Jiangsu Expressway or generate 1.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lifeway Foods vs. Jiangsu Expressway
Performance |
| Timeline |
| Lifeway Foods |
| Jiangsu Expressway |
Lifeway Foods and Jiangsu Expressway Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lifeway Foods and Jiangsu Expressway
The main advantage of trading using opposite Lifeway Foods and Jiangsu Expressway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lifeway Foods position performs unexpectedly, Jiangsu Expressway 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 Jiangsu Expressway will offset losses from the drop in Jiangsu Expressway's long position.| Lifeway Foods vs. Danone SA | Lifeway Foods vs. Superior Plus Corp | Lifeway Foods vs. NMI Holdings | Lifeway Foods vs. Origin Agritech |
| Jiangsu Expressway vs. Transurban Group | Jiangsu Expressway vs. Zhejiang Expressway Co | Jiangsu Expressway vs. Arcosa Inc |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
Other Complementary Tools
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance |