Correlation Between Lifestyle Global and Niko Semiconductor
Can any of the company-specific risk be diversified away by investing in both Lifestyle Global and Niko Semiconductor 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 Lifestyle Global and Niko Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lifestyle Global Enterprise and Niko Semiconductor Co, you can compare the effects of market volatilities on Lifestyle Global and Niko Semiconductor 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 Lifestyle Global with a short position of Niko Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lifestyle Global and Niko Semiconductor.
Diversification Opportunities for Lifestyle Global and Niko Semiconductor
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lifestyle and Niko is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Lifestyle Global Enterprise and Niko Semiconductor Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Niko Semiconductor and Lifestyle 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 Lifestyle Global Enterprise are associated (or correlated) with Niko Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Niko Semiconductor has no effect on the direction of Lifestyle Global i.e., Lifestyle Global and Niko Semiconductor go up and down completely randomly.
Pair Corralation between Lifestyle Global and Niko Semiconductor
Assuming the 90 days trading horizon Lifestyle Global Enterprise is expected to generate 0.63 times more return on investment than Niko Semiconductor. However, Lifestyle Global Enterprise is 1.59 times less risky than Niko Semiconductor. It trades about 0.01 of its potential returns per unit of risk. Niko Semiconductor Co is currently generating about -0.01 per unit of risk. If you would invest 2,590 in Lifestyle Global Enterprise on October 28, 2024 and sell it today you would earn a total of 70.00 from holding Lifestyle Global Enterprise or generate 2.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lifestyle Global Enterprise vs. Niko Semiconductor Co
Performance |
| Timeline |
| Lifestyle Global Ent |
| Niko Semiconductor |
Lifestyle Global and Niko Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lifestyle Global and Niko Semiconductor
The main advantage of trading using opposite Lifestyle Global and Niko Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lifestyle Global position performs unexpectedly, Niko Semiconductor 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 Niko Semiconductor will offset losses from the drop in Niko Semiconductor's long position.| Lifestyle Global vs. Jia Jie Biomedical | Lifestyle Global vs. Cowealth Medical Holding | Lifestyle Global vs. RiTdisplay Corp | Lifestyle Global vs. Top Union Electronics |
| Niko Semiconductor vs. Excelliance MOS | Niko Semiconductor vs. Sinopower Semiconductor | Niko Semiconductor vs. Advanced Power Electronics | Niko Semiconductor vs. Anpec Electronics |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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