Correlation Between Levima Advanced and Core Molding

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Can any of the company-specific risk be diversified away by investing in both Levima Advanced and Core Molding 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 Levima Advanced and Core Molding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Levima Advanced Materials and Core Molding Technologies, you can compare the effects of market volatilities on Levima Advanced and Core Molding 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 Levima Advanced with a short position of Core Molding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Levima Advanced and Core Molding.

Diversification Opportunities for Levima Advanced and Core Molding

-0.46
  Correlation Coefficient

Very good diversification

The 3 months correlation between Levima and Core is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Levima Advanced Materials and Core Molding Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Core Molding Technologies and Levima Advanced 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 Levima Advanced Materials are associated (or correlated) with Core Molding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Core Molding Technologies has no effect on the direction of Levima Advanced i.e., Levima Advanced and Core Molding go up and down completely randomly.

Pair Corralation between Levima Advanced and Core Molding

Assuming the 90 days trading horizon Levima Advanced Materials is expected to generate 0.9 times more return on investment than Core Molding. However, Levima Advanced Materials is 1.11 times less risky than Core Molding. It trades about 0.0 of its potential returns per unit of risk. Core Molding Technologies is currently generating about -0.05 per unit of risk. If you would invest  2,063  in Levima Advanced Materials on October 10, 2025 and sell it today you would lose (28.00) from holding Levima Advanced Materials or give up 1.36% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy97.56%
ValuesDaily Returns

Levima Advanced Materials  vs.  Core Molding Technologies

 Performance 
       Timeline  
Levima Advanced Materials 

Risk-Adjusted Performance

Weakest

 
Weak
 
Strong
Over the last 90 days Levima Advanced Materials has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Levima Advanced is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
Core Molding Technologies 

Risk-Adjusted Performance

Weak

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Core Molding Technologies are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable primary indicators, Core Molding is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Levima Advanced and Core Molding Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Levima Advanced and Core Molding

The main advantage of trading using opposite Levima Advanced and Core Molding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Levima Advanced position performs unexpectedly, Core Molding 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 Core Molding will offset losses from the drop in Core Molding's long position.
The idea behind Levima Advanced Materials and Core Molding 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.

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