Correlation Between Estee Lauder and Longevity Health

Can any of the company-specific risk be diversified away by investing in both Estee Lauder and Longevity Health 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 Estee Lauder and Longevity Health into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Estee Lauder Companies and Longevity Health Holdings,, you can compare the effects of market volatilities on Estee Lauder and Longevity Health 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 Estee Lauder with a short position of Longevity Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Estee Lauder and Longevity Health.

Diversification Opportunities for Estee Lauder and Longevity Health

-0.23

Correlation Coefficient

Estee Lauder  Longevity Health

Very good diversification

The 3 months correlation between Estee and Longevity is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Estee Lauder Companies and Longevity Health Holdings, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Longevity Health Hol and Estee Lauder 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 Estee Lauder Companies are associated (or correlated) with Longevity Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Longevity Health Hol has no effect on the direction of Estee Lauder i.e., Estee Lauder and Longevity Health go up and down completely randomly.

Pair Corralation between Estee Lauder and Longevity Health

Allowing for the 90-day total investment horizon Estee Lauder Companies is expected to generate 0.16 times more return on investment than Longevity Health. However, Estee Lauder Companies is 6.43 times less risky than Longevity Health. It trades about 0.28 of its potential returns per unit of risk. Longevity Health Holdings, is currently generating about 0.02 per unit of risk. If you would invest  5,741  in Estee Lauder Companies on May 5, 2025 and sell it today you would earn a total of  3,363  from holding Estee Lauder Companies or generate 58.58% return on investment over 90 days.

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

Estee Lauder Companies  vs.  Longevity Health Holdings,

Estee Lauder Companies

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Estee Lauder Companies are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting essential indicators, Estee Lauder disclosed solid returns over the last few months and may actually be approaching a breakup point.

Longevity Health Hol

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Longevity Health Holdings, are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak technical and fundamental indicators, Longevity Health exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Estee Lauder and Longevity Health

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

The idea behind Estee Lauder Companies and Longevity Health Holdings, 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.

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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.