Correlation Between Lakeland Industries and Zion Oil

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

By analyzing existing cross correlation between Lakeland Industries and Zion Oil Gas, you can compare the effects of market volatilities on Lakeland Industries and Zion Oil 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 Lakeland Industries with a short position of Zion Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lakeland Industries and Zion Oil.

Diversification Opportunities for Lakeland Industries and Zion Oil

0.0

Correlation Coefficient

Lakeland Industries  Zion Oil

Pay attention - limited upside

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

Pair Corralation between Lakeland Industries and Zion Oil

If you would invest  1,171  in Lakeland Industries on June 29, 2024 and sell it today you would earn a total of  844.00  from holding Lakeland Industries or generate 72.08% return on investment over 90 days.

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

Lakeland Industries  vs.  Zion Oil Gas

Lakeland Industries

Risk-Adjusted Performance

0 of 100

Very Weak

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

Zion Oil Gas

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Zion Oil Gas has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Zion Oil is not utilizing all of its potentials. The newest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Lakeland Industries and Zion Oil

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

The idea behind Lakeland Industries and Zion Oil Gas 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.