Correlation Between Avient Corp and LOWES
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By analyzing existing cross correlation between Avient Corp and LOWES INC 6875, you can compare the effects of market volatilities on Avient Corp and LOWES 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 Avient Corp with a short position of LOWES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Avient Corp and LOWES.
Diversification Opportunities for Avient Corp and LOWES
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Avient and LOWES is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Avient Corp and LOWES INC 6875 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LOWES INC 6875 and Avient Corp 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 Avient Corp are associated (or correlated) with LOWES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LOWES INC 6875 has no effect on the direction of Avient Corp i.e., Avient Corp and LOWES go up and down completely randomly.
Pair Corralation between Avient Corp and LOWES
Given the investment horizon of 90 days Avient Corp is expected to generate 2.77 times more return on investment than LOWES. However, Avient Corp is 2.77 times more volatile than LOWES INC 6875. It trades about 0.07 of its potential returns per unit of risk. LOWES INC 6875 is currently generating about 0.01 per unit of risk. If you would invest 3,433 in Avient Corp on September 14, 2024 and sell it today you would earn a total of 1,319 from holding Avient Corp or generate 38.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 81.78% |
| Values | Daily Returns |
Avient Corp vs. LOWES INC 6875
Performance |
| Timeline |
| Avient Corp |
| LOWES INC 6875 |
Avient Corp and LOWES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Avient Corp and LOWES
The main advantage of trading using opposite Avient Corp and LOWES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Avient Corp position performs unexpectedly, LOWES 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 will offset losses from the drop in LOWES's long position.| Avient Corp vs. LyondellBasell Industries NV | Avient Corp vs. Cabot | Avient Corp vs. Westlake Chemical | Avient Corp vs. Air Products and |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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