Correlation Between Corebridge Financial and Lincoln National

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

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

Diversification Opportunities for Corebridge Financial and Lincoln National

0.75

Correlation Coefficient

Corebridge Financial  Lincoln National

Poor diversification

The 3 months correlation between Corebridge and Lincoln is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Corebridge Financial and Lincoln National in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lincoln National and Corebridge Financial 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 Corebridge Financial are associated (or correlated) with Lincoln National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lincoln National has no effect on the direction of Corebridge Financial i.e., Corebridge Financial and Lincoln National go up and down completely randomly.

Pair Corralation between Corebridge Financial and Lincoln National

Given the investment horizon of 90 days Corebridge Financial is expected to generate 1.02 times less return on investment than Lincoln National. But when comparing it to its historical volatility, Corebridge Financial is 1.1 times less risky than Lincoln National. It trades about 0.07 of its potential returns per unit of risk. Lincoln National is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  2,797  in Lincoln National on May 6, 2025 and sell it today you would earn a total of  995.00  from holding Lincoln National or generate 35.57% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Corebridge Financial  vs.  Lincoln National

Corebridge Financial

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Corebridge Financial are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly inconsistent fundamental drivers, Corebridge Financial may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Lincoln National

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Lincoln National are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain basic indicators, Lincoln National exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Corebridge Financial and Lincoln National

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

The idea behind Corebridge Financial and Lincoln National 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.