Correlation Between AXWAY SOFTWARE and Lowes Companies
Can any of the company-specific risk be diversified away by investing in both AXWAY SOFTWARE and Lowes Companies 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 Lowes Companies 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 Lowes Companies, you can compare the effects of market volatilities on AXWAY SOFTWARE and Lowes Companies 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 Lowes Companies. Check out your portfolio center. Please also check ongoing floating volatility patterns of AXWAY SOFTWARE and Lowes Companies.
Diversification Opportunities for AXWAY SOFTWARE and Lowes Companies
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AXWAY and Lowes is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding AXWAY SOFTWARE EO and Lowes Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lowes Companies 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 Lowes Companies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lowes Companies has no effect on the direction of AXWAY SOFTWARE i.e., AXWAY SOFTWARE and Lowes Companies go up and down completely randomly.
Pair Corralation between AXWAY SOFTWARE and Lowes Companies
Assuming the 90 days horizon AXWAY SOFTWARE EO is expected to generate 1.25 times more return on investment than Lowes Companies. However, AXWAY SOFTWARE is 1.25 times more volatile than Lowes Companies. It trades about 0.07 of its potential returns per unit of risk. Lowes Companies is currently generating about 0.05 per unit of risk. If you would invest 1,494 in AXWAY SOFTWARE EO on September 3, 2024 and sell it today you would earn a total of 1,206 from holding AXWAY SOFTWARE EO or generate 80.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AXWAY SOFTWARE EO vs. Lowes Companies
Performance |
| Timeline |
| AXWAY SOFTWARE EO |
| Lowes Companies |
AXWAY SOFTWARE and Lowes Companies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AXWAY SOFTWARE and Lowes Companies
The main advantage of trading using opposite AXWAY SOFTWARE and Lowes Companies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AXWAY SOFTWARE position performs unexpectedly, Lowes Companies 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 Lowes Companies will offset losses from the drop in Lowes Companies' long position.| AXWAY SOFTWARE vs. NH HOTEL GROUP | AXWAY SOFTWARE vs. Wyndham Hotels Resorts | AXWAY SOFTWARE vs. Wayside Technology Group | AXWAY SOFTWARE vs. Computer And Technologies |
| Lowes Companies vs. BURLINGTON STORES | Lowes Companies vs. Chongqing Machinery Electric | Lowes Companies vs. Retail Estates NV | Lowes Companies vs. MARKET VECTR RETAIL |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
Other Complementary Tools
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Transaction History View history of all your transactions and understand their impact on performance |