Correlation Between AXWAY SOFTWARE and Look Holdings
Can any of the company-specific risk be diversified away by investing in both AXWAY SOFTWARE and Look Holdings 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 AXWAY SOFTWARE and Look Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AXWAY SOFTWARE EO and Look Holdings, you can compare the effects of market volatilities on AXWAY SOFTWARE and Look Holdings 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 AXWAY SOFTWARE with a short position of Look Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of AXWAY SOFTWARE and Look Holdings.
Diversification Opportunities for AXWAY SOFTWARE and Look Holdings
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between AXWAY and Look is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding AXWAY SOFTWARE EO and Look Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Look Holdings and AXWAY SOFTWARE 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 AXWAY SOFTWARE EO are associated (or correlated) with Look Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Look Holdings has no effect on the direction of AXWAY SOFTWARE i.e., AXWAY SOFTWARE and Look Holdings go up and down completely randomly.
Pair Corralation between AXWAY SOFTWARE and Look Holdings
Assuming the 90 days horizon AXWAY SOFTWARE EO is expected to generate 0.81 times more return on investment than Look Holdings. However, AXWAY SOFTWARE EO is 1.23 times less risky than Look Holdings. It trades about 0.05 of its potential returns per unit of risk. Look Holdings is currently generating about -0.08 per unit of risk. If you would invest 2,620 in AXWAY SOFTWARE EO on November 4, 2024 and sell it today you would earn a total of 30.00 from holding AXWAY SOFTWARE EO or generate 1.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
AXWAY SOFTWARE EO vs. Look Holdings
Performance |
| Timeline |
| AXWAY SOFTWARE EO |
| Look Holdings |
AXWAY SOFTWARE and Look Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AXWAY SOFTWARE and Look Holdings
The main advantage of trading using opposite AXWAY SOFTWARE and Look Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AXWAY SOFTWARE position performs unexpectedly, Look Holdings 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 Look Holdings will offset losses from the drop in Look Holdings' long position.| AXWAY SOFTWARE vs. CAIRN HOMES EO | AXWAY SOFTWARE vs. Japan Tobacco | AXWAY SOFTWARE vs. EEDUCATION ALBERT AB | AXWAY SOFTWARE vs. STRAYER EDUCATION |
| Look Holdings vs. Iridium Communications | Look Holdings vs. Fast Retailing Co | Look Holdings vs. SOCKET MOBILE NEW | Look Holdings vs. Verizon Communications |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
Other Complementary Tools
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Bonds Directory Find actively traded corporate debentures issued by US companies |