Correlation Between 23Andme Holding and Lexaria Bioscience
Can any of the company-specific risk be diversified away by investing in both 23Andme Holding and Lexaria Bioscience 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 23Andme Holding and Lexaria Bioscience into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 23Andme Holding Co and Lexaria Bioscience Corp, you can compare the effects of market volatilities on 23Andme Holding and Lexaria Bioscience 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 23Andme Holding with a short position of Lexaria Bioscience. Check out your portfolio center. Please also check ongoing floating volatility patterns of 23Andme Holding and Lexaria Bioscience.
Diversification Opportunities for 23Andme Holding and Lexaria Bioscience
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 23Andme and Lexaria is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding 23Andme Holding Co and Lexaria Bioscience Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lexaria Bioscience Corp and 23Andme Holding 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 23Andme Holding Co are associated (or correlated) with Lexaria Bioscience. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lexaria Bioscience Corp has no effect on the direction of 23Andme Holding i.e., 23Andme Holding and Lexaria Bioscience go up and down completely randomly.
Pair Corralation between 23Andme Holding and Lexaria Bioscience
Allowing for the 90-day total investment horizon 23Andme Holding Co is expected to under-perform the Lexaria Bioscience. But the stock apears to be less risky and, when comparing its historical volatility, 23Andme Holding Co is 1.11 times less risky than Lexaria Bioscience. The stock trades about -0.11 of its potential returns per unit of risk. The Lexaria Bioscience Corp is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 70.00 in Lexaria Bioscience Corp on September 1, 2024 and sell it today you would earn a total of 10.00 from holding Lexaria Bioscience Corp or generate 14.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
23Andme Holding Co vs. Lexaria Bioscience Corp
Performance |
| Timeline |
| 23Andme Holding |
| Lexaria Bioscience Corp |
23Andme Holding and Lexaria Bioscience Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 23Andme Holding and Lexaria Bioscience
The main advantage of trading using opposite 23Andme Holding and Lexaria Bioscience positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 23Andme Holding position performs unexpectedly, Lexaria Bioscience 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 Lexaria Bioscience will offset losses from the drop in Lexaria Bioscience's long position.| 23Andme Holding vs. IDEXX Laboratories | 23Andme Holding vs. Twist Bioscience Corp | 23Andme Holding vs. Guardant Health | 23Andme Holding vs. Agilent Technologies |
| Lexaria Bioscience vs. Lexaria Bioscience Corp | Lexaria Bioscience vs. Lixte Biotechnology Holdings | Lexaria Bioscience vs. GeoVax Labs | Lexaria Bioscience vs. Reviva Pharmaceuticals Holdings |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
Other Complementary Tools
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| 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 | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences |