Correlation Between LPKF Laser and Coor Service
Can any of the company-specific risk be diversified away by investing in both LPKF Laser and Coor Service 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 LPKF Laser and Coor Service into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LPKF Laser Electronics and Coor Service Management, you can compare the effects of market volatilities on LPKF Laser and Coor Service 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 LPKF Laser with a short position of Coor Service. Check out your portfolio center. Please also check ongoing floating volatility patterns of LPKF Laser and Coor Service.
Diversification Opportunities for LPKF Laser and Coor Service
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between LPKF and Coor is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding LPKF Laser Electronics and Coor Service Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coor Service Management and LPKF Laser 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 LPKF Laser Electronics are associated (or correlated) with Coor Service. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coor Service Management has no effect on the direction of LPKF Laser i.e., LPKF Laser and Coor Service go up and down completely randomly.
Pair Corralation between LPKF Laser and Coor Service
Assuming the 90 days trading horizon LPKF Laser Electronics is expected to generate 0.57 times more return on investment than Coor Service. However, LPKF Laser Electronics is 1.76 times less risky than Coor Service. It trades about -0.03 of its potential returns per unit of risk. Coor Service Management is currently generating about -0.23 per unit of risk. If you would invest 880.00 in LPKF Laser Electronics on September 3, 2024 and sell it today you would lose (20.00) from holding LPKF Laser Electronics or give up 2.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
LPKF Laser Electronics vs. Coor Service Management
Performance |
| Timeline |
| LPKF Laser Electronics |
| Coor Service Management |
LPKF Laser and Coor Service Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LPKF Laser and Coor Service
The main advantage of trading using opposite LPKF Laser and Coor Service positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LPKF Laser position performs unexpectedly, Coor Service 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 Coor Service will offset losses from the drop in Coor Service's long position.| LPKF Laser vs. Catalyst Media Group | LPKF Laser vs. CATLIN GROUP | LPKF Laser vs. Magnora ASA | LPKF Laser vs. RTW Venture Fund |
| Coor Service vs. Spirent Communications plc | Coor Service vs. Coeur Mining | Coor Service vs. Beowulf Mining | Coor Service vs. Invesco Physical Silver |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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