Correlation Between Marfrig Global and Lifecore Biomedical

Can any of the company-specific risk be diversified away by investing in both Marfrig Global and Lifecore Biomedical 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 Marfrig Global and Lifecore Biomedical into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Marfrig Global Foods and Lifecore Biomedical, you can compare the effects of market volatilities on Marfrig Global and Lifecore Biomedical 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 Marfrig Global with a short position of Lifecore Biomedical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marfrig Global and Lifecore Biomedical.

Diversification Opportunities for Marfrig Global and Lifecore Biomedical

0.02

Correlation Coefficient

Marfrig Global  Lifecore Biomedical

Significant diversification

The 3 months correlation between Marfrig and Lifecore is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Marfrig Global Foods and Lifecore Biomedical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lifecore Biomedical and Marfrig Global 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 Marfrig Global Foods are associated (or correlated) with Lifecore Biomedical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lifecore Biomedical has no effect on the direction of Marfrig Global i.e., Marfrig Global and Lifecore Biomedical go up and down completely randomly.

Pair Corralation between Marfrig Global and Lifecore Biomedical

Assuming the 90 days horizon Marfrig Global Foods is expected to generate 1.9 times more return on investment than Lifecore Biomedical. However, Marfrig Global is 1.9 times more volatile than Lifecore Biomedical. It trades about 0.06 of its potential returns per unit of risk. Lifecore Biomedical is currently generating about 0.03 per unit of risk. If you would invest  360.00  in Marfrig Global Foods on May 6, 2025 and sell it today you would earn a total of  40.00  from holding Marfrig Global Foods or generate 11.11% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.41%
Values	Daily Returns

Marfrig Global Foods  vs.  Lifecore Biomedical

Marfrig Global Foods

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Marfrig Global Foods are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Marfrig Global showed solid returns over the last few months and may actually be approaching a breakup point.

Lifecore Biomedical

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Lifecore Biomedical are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable fundamental indicators, Lifecore Biomedical is not utilizing all of its potentials. The recent stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Marfrig Global and Lifecore Biomedical

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

The idea behind Marfrig Global Foods and Lifecore Biomedical 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.