Correlation Between Cisco Systems and LF Capital
Can any of the company-specific risk be diversified away by investing in both Cisco Systems and LF Capital 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 Cisco Systems and LF Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cisco Systems and LF Capital Acquisition, you can compare the effects of market volatilities on Cisco Systems and LF Capital 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 Cisco Systems with a short position of LF Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cisco Systems and LF Capital.
Diversification Opportunities for Cisco Systems and LF Capital
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Cisco and LFAC is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Cisco Systems and LF Capital Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LF Capital Acquisition and Cisco Systems 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 Cisco Systems are associated (or correlated) with LF Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LF Capital Acquisition has no effect on the direction of Cisco Systems i.e., Cisco Systems and LF Capital go up and down completely randomly.
Pair Corralation between Cisco Systems and LF Capital
If you would invest 5,282 in Cisco Systems on August 29, 2024 and sell it today you would earn a total of 626.50 from holding Cisco Systems or generate 11.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 2.33% |
| Values | Daily Returns |
Cisco Systems vs. LF Capital Acquisition
Performance |
| Timeline |
| Cisco Systems |
| LF Capital Acquisition |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Cisco Systems and LF Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cisco Systems and LF Capital
The main advantage of trading using opposite Cisco Systems and LF Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cisco Systems position performs unexpectedly, LF Capital 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 LF Capital will offset losses from the drop in LF Capital's long position.| Cisco Systems vs. NETGEAR | Cisco Systems vs. Clearfield | Cisco Systems vs. ABIVAX Socit Anonyme | Cisco Systems vs. Morningstar Unconstrained Allocation |
| LF Capital vs. Swiftmerge Acquisition Corp | LF Capital vs. Latamgrowth SPAC Unit | LF Capital vs. TLGY Acquisition Corp | LF Capital vs. Qomolangma Acquisition Corp |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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