Correlation Between Alpha Teknova and Lifecore Biomedical
Can any of the company-specific risk be diversified away by investing in both Alpha Teknova and Lifecore Biomedical 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 Alpha Teknova and Lifecore Biomedical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alpha Teknova and Lifecore Biomedical, you can compare the effects of market volatilities on Alpha Teknova and Lifecore Biomedical 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 Alpha Teknova with a short position of Lifecore Biomedical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alpha Teknova and Lifecore Biomedical.
Diversification Opportunities for Alpha Teknova and Lifecore Biomedical
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Alpha and Lifecore is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Alpha Teknova and Lifecore Biomedical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lifecore Biomedical and Alpha Teknova 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 Alpha Teknova are associated (or correlated) with Lifecore Biomedical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lifecore Biomedical has no effect on the direction of Alpha Teknova i.e., Alpha Teknova and Lifecore Biomedical go up and down completely randomly.
Pair Corralation between Alpha Teknova and Lifecore Biomedical
Given the investment horizon of 90 days Alpha Teknova is expected to generate 2.43 times less return on investment than Lifecore Biomedical. In addition to that, Alpha Teknova is 1.79 times more volatile than Lifecore Biomedical. It trades about 0.07 of its total potential returns per unit of risk. Lifecore Biomedical is currently generating about 0.32 per unit of volatility. If you would invest 562.00 in Lifecore Biomedical on August 28, 2024 and sell it today you would earn a total of 184.00 from holding Lifecore Biomedical or generate 32.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alpha Teknova vs. Lifecore Biomedical
Performance |
| Timeline |
| Alpha Teknova |
| Lifecore Biomedical |
Alpha Teknova and Lifecore Biomedical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alpha Teknova and Lifecore Biomedical
The main advantage of trading using opposite Alpha Teknova and Lifecore Biomedical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alpha Teknova position performs unexpectedly, Lifecore Biomedical 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 Lifecore Biomedical will offset losses from the drop in Lifecore Biomedical's long position.| Alpha Teknova vs. Collegium Pharmaceutical | Alpha Teknova vs. Phibro Animal Health | Alpha Teknova vs. ANI Pharmaceuticals | Alpha Teknova vs. Procaps Group SA |
| Lifecore Biomedical vs. Eliem Therapeutics | Lifecore Biomedical vs. HCW Biologics | Lifecore Biomedical vs. Scpharmaceuticals | Lifecore Biomedical vs. Milestone Pharmaceuticals |
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
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |