Correlation Between LifeMD and FOXO Technologies

Can any of the company-specific risk be diversified away by investing in both LifeMD and FOXO Technologies 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 LifeMD and FOXO Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between LifeMD Inc and FOXO Technologies, you can compare the effects of market volatilities on LifeMD and FOXO Technologies 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 LifeMD with a short position of FOXO Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of LifeMD and FOXO Technologies.

Diversification Opportunities for LifeMD and FOXO Technologies

-0.44

Correlation Coefficient

LifeMD  FOXO Technologies

Very good diversification

The 3 months correlation between LifeMD and FOXO is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding LifeMD Inc and FOXO Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FOXO Technologies and LifeMD 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 LifeMD Inc are associated (or correlated) with FOXO Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FOXO Technologies has no effect on the direction of LifeMD i.e., LifeMD and FOXO Technologies go up and down completely randomly.

Pair Corralation between LifeMD and FOXO Technologies

Given the investment horizon of 90 days LifeMD Inc is expected to generate 1.27 times more return on investment than FOXO Technologies. However, LifeMD is 1.27 times more volatile than FOXO Technologies. It trades about 0.22 of its potential returns per unit of risk. FOXO Technologies is currently generating about -0.23 per unit of risk. If you would invest  1,027  in LifeMD Inc on February 9, 2024 and sell it today you would earn a total of  206.00  from holding LifeMD Inc or generate 20.06% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	95.65%
Values	Daily Returns

LifeMD Inc  vs.  FOXO Technologies

LifeMD Inc

Risk-Adjusted Performance

23 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in LifeMD Inc are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating primary indicators, LifeMD exhibited solid returns over the last few months and may actually be approaching a breakup point.

FOXO Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days FOXO Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in June 2024. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with LifeMD and FOXO Technologies

The main advantage of trading using opposite LifeMD and FOXO Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LifeMD position performs unexpectedly, FOXO Technologies 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 FOXO Technologies will offset losses from the drop in FOXO Technologies' long position.

The idea behind LifeMD Inc and FOXO Technologies pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.