Correlation Between Big Tree and LENSAR
Can any of the company-specific risk be diversified away by investing in both Big Tree and LENSAR 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 Big Tree and LENSAR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Big Tree Group and LENSAR Inc, you can compare the effects of market volatilities on Big Tree and LENSAR 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 Big Tree with a short position of LENSAR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Big Tree and LENSAR.
Diversification Opportunities for Big Tree and LENSAR
Pay attention - limited upside
The 3 months correlation between Big and LENSAR is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Big Tree Group and LENSAR Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LENSAR Inc and Big Tree 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 Big Tree Group are associated (or correlated) with LENSAR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LENSAR Inc has no effect on the direction of Big Tree i.e., Big Tree and LENSAR go up and down completely randomly.
Pair Corralation between Big Tree and LENSAR
If you would invest 586.00 in LENSAR Inc on September 5, 2024 and sell it today you would earn a total of 178.00 from holding LENSAR Inc or generate 30.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 4.55% |
| Values | Daily Returns |
Big Tree Group vs. LENSAR Inc
Performance |
| Timeline |
| Big Tree Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| LENSAR Inc |
Big Tree and LENSAR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Big Tree and LENSAR
The main advantage of trading using opposite Big Tree and LENSAR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Big Tree position performs unexpectedly, LENSAR 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 LENSAR will offset losses from the drop in LENSAR's long position.| Big Tree vs. LENSAR Inc | Big Tree vs. China Tontine Wines | Big Tree vs. Microbot Medical | Big Tree vs. Treasury Wine Estates |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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