Correlation Between CK Hutchison and Lifevantage
Can any of the company-specific risk be diversified away by investing in both CK Hutchison and Lifevantage 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 CK Hutchison and Lifevantage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CK Hutchison Holdings and Lifevantage, you can compare the effects of market volatilities on CK Hutchison and Lifevantage 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 CK Hutchison with a short position of Lifevantage. Check out your portfolio center. Please also check ongoing floating volatility patterns of CK Hutchison and Lifevantage.
Diversification Opportunities for CK Hutchison and Lifevantage
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between CKHUF and Lifevantage is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding CK Hutchison Holdings and Lifevantage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lifevantage and CK Hutchison 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 CK Hutchison Holdings are associated (or correlated) with Lifevantage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lifevantage has no effect on the direction of CK Hutchison i.e., CK Hutchison and Lifevantage go up and down completely randomly.
Pair Corralation between CK Hutchison and Lifevantage
Assuming the 90 days horizon CK Hutchison Holdings is expected to generate 0.36 times more return on investment than Lifevantage. However, CK Hutchison Holdings is 2.81 times less risky than Lifevantage. It trades about 0.07 of its potential returns per unit of risk. Lifevantage is currently generating about -0.02 per unit of risk. If you would invest 481.00 in CK Hutchison Holdings on January 29, 2024 and sell it today you would earn a total of 9.00 from holding CK Hutchison Holdings or generate 1.87% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
CK Hutchison Holdings vs. Lifevantage
Performance |
Timeline |
CK Hutchison Holdings |
Lifevantage |
CK Hutchison and Lifevantage Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with CK Hutchison and Lifevantage
The main advantage of trading using opposite CK Hutchison and Lifevantage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CK Hutchison position performs unexpectedly, Lifevantage 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 Lifevantage will offset losses from the drop in Lifevantage's long position.CK Hutchison vs. Honeywell International | CK Hutchison vs. 3M Company | CK Hutchison vs. Hitachi Ltd ADR | CK Hutchison vs. Mitsui Co |
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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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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