Correlation Between Artemis Strategic and Lumbee Guaranty
Can any of the company-specific risk be diversified away by investing in both Artemis Strategic and Lumbee Guaranty 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 Artemis Strategic and Lumbee Guaranty into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Artemis Strategic Investment and Lumbee Guaranty Bank, you can compare the effects of market volatilities on Artemis Strategic and Lumbee Guaranty 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 Artemis Strategic with a short position of Lumbee Guaranty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Artemis Strategic and Lumbee Guaranty.
Diversification Opportunities for Artemis Strategic and Lumbee Guaranty
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Artemis and Lumbee is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Artemis Strategic Investment and Lumbee Guaranty Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lumbee Guaranty Bank and Artemis Strategic 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 Artemis Strategic Investment are associated (or correlated) with Lumbee Guaranty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lumbee Guaranty Bank has no effect on the direction of Artemis Strategic i.e., Artemis Strategic and Lumbee Guaranty go up and down completely randomly.
Pair Corralation between Artemis Strategic and Lumbee Guaranty
Given the investment horizon of 90 days Artemis Strategic is expected to generate 2.45 times less return on investment than Lumbee Guaranty. But when comparing it to its historical volatility, Artemis Strategic Investment is 11.0 times less risky than Lumbee Guaranty. It trades about 0.13 of its potential returns per unit of risk. Lumbee Guaranty Bank is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,011 in Lumbee Guaranty Bank on August 31, 2024 and sell it today you would earn a total of 179.00 from holding Lumbee Guaranty Bank or generate 17.71% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 13.45% |
Values | Daily Returns |
Artemis Strategic Investment vs. Lumbee Guaranty Bank
Performance |
Timeline |
Artemis Strategic |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Lumbee Guaranty Bank |
Artemis Strategic and Lumbee Guaranty Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Artemis Strategic and Lumbee Guaranty
The main advantage of trading using opposite Artemis Strategic and Lumbee Guaranty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Artemis Strategic position performs unexpectedly, Lumbee Guaranty 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 Lumbee Guaranty will offset losses from the drop in Lumbee Guaranty's long position.The idea behind Artemis Strategic Investment and Lumbee Guaranty Bank 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.Lumbee Guaranty vs. Bank Mandiri Persero | Lumbee Guaranty vs. Piraeus Bank SA | Lumbee Guaranty vs. Eurobank Ergasias Services | Lumbee Guaranty vs. Kasikornbank Public Co |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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