Correlation Between Lifeway Foods and Franklin Wireless
Can any of the company-specific risk be diversified away by investing in both Lifeway Foods and Franklin Wireless 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 Lifeway Foods and Franklin Wireless into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lifeway Foods and Franklin Wireless Corp, you can compare the effects of market volatilities on Lifeway Foods and Franklin Wireless 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 Lifeway Foods with a short position of Franklin Wireless. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lifeway Foods and Franklin Wireless.
Diversification Opportunities for Lifeway Foods and Franklin Wireless
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Lifeway and Franklin is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Lifeway Foods and Franklin Wireless Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Wireless Corp and Lifeway Foods 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 Lifeway Foods are associated (or correlated) with Franklin Wireless. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Wireless Corp has no effect on the direction of Lifeway Foods i.e., Lifeway Foods and Franklin Wireless go up and down completely randomly.
Pair Corralation between Lifeway Foods and Franklin Wireless
Given the investment horizon of 90 days Lifeway Foods is expected to under-perform the Franklin Wireless. In addition to that, Lifeway Foods is 1.64 times more volatile than Franklin Wireless Corp. It trades about -0.11 of its total potential returns per unit of risk. Franklin Wireless Corp is currently generating about 0.08 per unit of volatility. If you would invest 406.00 in Franklin Wireless Corp on September 7, 2025 and sell it today you would earn a total of 40.00 from holding Franklin Wireless Corp or generate 9.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lifeway Foods vs. Franklin Wireless Corp
Performance |
| Timeline |
| Lifeway Foods |
| Franklin Wireless Corp |
Lifeway Foods and Franklin Wireless Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lifeway Foods and Franklin Wireless
The main advantage of trading using opposite Lifeway Foods and Franklin Wireless positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lifeway Foods position performs unexpectedly, Franklin Wireless 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 Franklin Wireless will offset losses from the drop in Franklin Wireless' long position.| Lifeway Foods vs. CanSino Biologics | Lifeway Foods vs. ScanSource | Lifeway Foods vs. QKL Stores | Lifeway Foods vs. National Retail Properties |
| Franklin Wireless vs. Ubiquiti Networks | Franklin Wireless vs. Chengdu Spaceon Electronics | Franklin Wireless vs. Viavi Solutions | Franklin Wireless vs. Beijing Jiaxun Feihong |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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