Correlation Between Axalta Coating and LOBO EV
Can any of the company-specific risk be diversified away by investing in both Axalta Coating and LOBO EV 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 Axalta Coating and LOBO EV into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Axalta Coating Systems and LOBO EV TECHNOLOGIES, you can compare the effects of market volatilities on Axalta Coating and LOBO EV 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 Axalta Coating with a short position of LOBO EV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axalta Coating and LOBO EV.
Diversification Opportunities for Axalta Coating and LOBO EV
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Axalta and LOBO is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Axalta Coating Systems and LOBO EV TECHNOLOGIES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LOBO EV TECHNOLOGIES and Axalta Coating 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 Axalta Coating Systems are associated (or correlated) with LOBO EV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LOBO EV TECHNOLOGIES has no effect on the direction of Axalta Coating i.e., Axalta Coating and LOBO EV go up and down completely randomly.
Pair Corralation between Axalta Coating and LOBO EV
Given the investment horizon of 90 days Axalta Coating Systems is expected to generate 0.28 times more return on investment than LOBO EV. However, Axalta Coating Systems is 3.59 times less risky than LOBO EV. It trades about 0.24 of its potential returns per unit of risk. LOBO EV TECHNOLOGIES is currently generating about -0.02 per unit of risk. If you would invest 3,440 in Axalta Coating Systems on October 21, 2024 and sell it today you would earn a total of 188.00 from holding Axalta Coating Systems or generate 5.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Axalta Coating Systems vs. LOBO EV TECHNOLOGIES
Performance |
| Timeline |
| Axalta Coating Systems |
| LOBO EV TECHNOLOGIES |
Axalta Coating and LOBO EV Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Axalta Coating and LOBO EV
The main advantage of trading using opposite Axalta Coating and LOBO EV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Axalta Coating position performs unexpectedly, LOBO EV 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 LOBO EV will offset losses from the drop in LOBO EV's long position.| Axalta Coating vs. Avient Corp | Axalta Coating vs. H B Fuller | Axalta Coating vs. Quaker Chemical | Axalta Coating vs. Cabot |
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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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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