Correlation Between Live Ventures and Lydall

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

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

Diversification Opportunities for Live Ventures and Lydall

0.0

Correlation Coefficient

Live Ventures  Lydall

Pay attention - limited upside

The 3 months correlation between Live and Lydall is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Live Ventures and Lydall Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lydall Inc and Live Ventures 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 Live Ventures are associated (or correlated) with Lydall. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lydall Inc has no effect on the direction of Live Ventures i.e., Live Ventures and Lydall go up and down completely randomly.

Pair Corralation between Live Ventures and Lydall

If you would invest  2,500  in Live Ventures on February 27, 2024 and sell it today you would lose (19.00) from holding Live Ventures or give up 0.76% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Live Ventures  vs.  Lydall Inc

Live Ventures

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Live Ventures has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Live Ventures is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Lydall Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Lydall Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent fundamental indicators, Lydall is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Live Ventures and Lydall

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

The idea behind Live Ventures and Lydall Inc 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.