Correlation Between LIFEWAY FOODS and Blackstone
Can any of the company-specific risk be diversified away by investing in both LIFEWAY FOODS and Blackstone 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 Blackstone into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LIFEWAY FOODS and Blackstone Group, you can compare the effects of market volatilities on LIFEWAY FOODS and Blackstone 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 Blackstone. Check out your portfolio center. Please also check ongoing floating volatility patterns of LIFEWAY FOODS and Blackstone.
Diversification Opportunities for LIFEWAY FOODS and Blackstone
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between LIFEWAY and Blackstone is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding LIFEWAY FOODS and Blackstone Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackstone Group 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 Blackstone. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackstone Group has no effect on the direction of LIFEWAY FOODS i.e., LIFEWAY FOODS and Blackstone go up and down completely randomly.
Pair Corralation between LIFEWAY FOODS and Blackstone
Assuming the 90 days trading horizon LIFEWAY FOODS is expected to under-perform the Blackstone. In addition to that, LIFEWAY FOODS is 1.61 times more volatile than Blackstone Group. It trades about -0.04 of its total potential returns per unit of risk. Blackstone Group is currently generating about 0.32 per unit of volatility. If you would invest 15,620 in Blackstone Group on August 29, 2024 and sell it today you would earn a total of 2,660 from holding Blackstone Group or generate 17.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
LIFEWAY FOODS vs. Blackstone Group
Performance |
| Timeline |
| LIFEWAY FOODS |
| Blackstone Group |
LIFEWAY FOODS and Blackstone Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LIFEWAY FOODS and Blackstone
The main advantage of trading using opposite LIFEWAY FOODS and Blackstone positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LIFEWAY FOODS position performs unexpectedly, Blackstone 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 Blackstone will offset losses from the drop in Blackstone's long position.| LIFEWAY FOODS vs. TreeHouse Foods | LIFEWAY FOODS vs. SCOTT TECHNOLOGY | LIFEWAY FOODS vs. Align Technology | LIFEWAY FOODS vs. AUSTEVOLL SEAFOOD |
| Blackstone vs. JAPAN TOBACCO UNSPADR12 | Blackstone vs. BRIT AMER TOBACCO | Blackstone vs. THAI BEVERAGE | Blackstone 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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