Correlation Between Road King and LM Funding
Can any of the company-specific risk be diversified away by investing in both Road King and LM Funding 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 Road King and LM Funding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Road King Infrastructure and LM Funding America, you can compare the effects of market volatilities on Road King and LM Funding 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 Road King with a short position of LM Funding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Road King and LM Funding.
Diversification Opportunities for Road King and LM Funding
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Road and LMFA is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Road King Infrastructure and LM Funding America in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LM Funding America and Road King 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 Road King Infrastructure are associated (or correlated) with LM Funding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LM Funding America has no effect on the direction of Road King i.e., Road King and LM Funding go up and down completely randomly.
Pair Corralation between Road King and LM Funding
Assuming the 90 days horizon Road King Infrastructure is expected to generate 0.23 times more return on investment than LM Funding. However, Road King Infrastructure is 4.38 times less risky than LM Funding. It trades about 0.12 of its potential returns per unit of risk. LM Funding America is currently generating about -0.01 per unit of risk. If you would invest 8.00 in Road King Infrastructure on September 9, 2025 and sell it today you would earn a total of 1.00 from holding Road King Infrastructure or generate 12.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Road King Infrastructure vs. LM Funding America
Performance |
| Timeline |
| Road King Infrastructure |
| LM Funding America |
Road King and LM Funding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Road King and LM Funding
The main advantage of trading using opposite Road King and LM Funding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Road King position performs unexpectedly, LM Funding 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 LM Funding will offset losses from the drop in LM Funding's long position.| Road King vs. Consorcio ARA S | Road King vs. Bloomberry Resorts | Road King vs. Consumer Automotive Finance | Road King vs. Hong Kong Television |
| LM Funding vs. Nisun International Enterprise | LM Funding vs. Abits Group | LM Funding vs. Archimedes Tech SPAC | LM Funding vs. Presurance Holdings, |
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 AI Portfolio Prophet module to use AI to generate optimal portfolios and find profitable investment opportunities.
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