Correlation Between Lexaria Bioscience and Danone PK
Can any of the company-specific risk be diversified away by investing in both Lexaria Bioscience and Danone PK 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 Lexaria Bioscience and Danone PK into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lexaria Bioscience Corp and Danone PK, you can compare the effects of market volatilities on Lexaria Bioscience and Danone PK 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 Lexaria Bioscience with a short position of Danone PK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lexaria Bioscience and Danone PK.
Diversification Opportunities for Lexaria Bioscience and Danone PK
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Lexaria and Danone is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Lexaria Bioscience Corp and Danone PK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Danone PK and Lexaria Bioscience 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 Lexaria Bioscience Corp are associated (or correlated) with Danone PK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Danone PK has no effect on the direction of Lexaria Bioscience i.e., Lexaria Bioscience and Danone PK go up and down completely randomly.
Pair Corralation between Lexaria Bioscience and Danone PK
If you would invest 1,285 in Danone PK on January 26, 2024 and sell it today you would earn a total of 0.00 from holding Danone PK or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Lexaria Bioscience Corp vs. Danone PK
Performance |
| Timeline |
| Lexaria Bioscience Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Danone PK |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Lexaria Bioscience and Danone PK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lexaria Bioscience and Danone PK
The main advantage of trading using opposite Lexaria Bioscience and Danone PK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lexaria Bioscience position performs unexpectedly, Danone PK 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 Danone PK will offset losses from the drop in Danone PK's long position.| Lexaria Bioscience vs. SWK Holdings Corp | Lexaria Bioscience vs. Dream Office Real | Lexaria Bioscience vs. Stevanato Group SpA | Lexaria Bioscience vs. RBC Bearings Incorporated |
| Danone PK vs. Heineken NV | Danone PK vs. Reckitt Benckiser Group | Danone PK vs. LOreal Co ADR | Danone PK vs. BASF SE ADR |
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.
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