Correlation Between Liberty Broadband and Compass Minerals

Can any of the company-specific risk be diversified away by investing in both Liberty Broadband and Compass Minerals 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 Liberty Broadband and Compass Minerals into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Liberty Broadband and Compass Minerals International, you can compare the effects of market volatilities on Liberty Broadband and Compass Minerals 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 Liberty Broadband with a short position of Compass Minerals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Liberty Broadband and Compass Minerals.

Diversification Opportunities for Liberty Broadband and Compass Minerals

0.37

Correlation Coefficient

Liberty Broadband  Compass Minerals

Weak diversification

The 3 months correlation between Liberty and Compass is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Liberty Broadband and Compass Minerals International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Compass Minerals Int and Liberty Broadband 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 Liberty Broadband are associated (or correlated) with Compass Minerals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Compass Minerals Int has no effect on the direction of Liberty Broadband i.e., Liberty Broadband and Compass Minerals go up and down completely randomly.

Pair Corralation between Liberty Broadband and Compass Minerals

Assuming the 90 days horizon Liberty Broadband is expected to under-perform the Compass Minerals. In addition to that, Liberty Broadband is 1.22 times more volatile than Compass Minerals International. It trades about -0.13 of its total potential returns per unit of risk. Compass Minerals International is currently generating about 0.05 per unit of volatility. If you would invest  1,881  in Compass Minerals International on September 5, 2025 and sell it today you would earn a total of  131.00  from holding Compass Minerals International or generate 6.96% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.44%
Values	Daily Returns

Liberty Broadband  vs.  Compass Minerals International

Liberty Broadband

Risk-Adjusted Performance

Weakest

Over the last 90 days Liberty Broadband has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Stock's fundamental indicators remain somewhat strong which may send shares a bit higher in January 2026. The current disturbance may also be a sign of long term up-swing for the company investors.

Compass Minerals Int

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in Compass Minerals International are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively fragile primary indicators, Compass Minerals may actually be approaching a critical reversion point that can send shares even higher in January 2026.

Pair Trading with Liberty Broadband and Compass Minerals

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

The idea behind Liberty Broadband and Compass Minerals International 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.