Correlation Between Dole PLC and LQR House

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Can any of the company-specific risk be diversified away by investing in both Dole PLC and LQR House 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 Dole PLC and LQR House into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dole PLC and LQR House, you can compare the effects of market volatilities on Dole PLC and LQR House 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 Dole PLC with a short position of LQR House. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dole PLC and LQR House.

Diversification Opportunities for Dole PLC and LQR House

DoleLQRDiversified AwayDoleLQRDiversified Away100%
-0.36
  Correlation Coefficient

Very good diversification

The 3 months correlation between Dole and LQR is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Dole PLC and LQR House in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LQR House and Dole PLC 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 Dole PLC are associated (or correlated) with LQR House. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LQR House has no effect on the direction of Dole PLC i.e., Dole PLC and LQR House go up and down completely randomly.

Pair Corralation between Dole PLC and LQR House

Given the investment horizon of 90 days Dole PLC is expected to generate 0.15 times more return on investment than LQR House. However, Dole PLC is 6.59 times less risky than LQR House. It trades about 0.04 of its potential returns per unit of risk. LQR House is currently generating about -0.06 per unit of risk. If you would invest  1,118  in Dole PLC on November 30, 2024 and sell it today you would earn a total of  340.00  from holding Dole PLC or generate 30.41% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy78.9%
ValuesDaily Returns

Dole PLC  vs.  LQR House

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -30-20-100102030
JavaScript chart by amCharts 3.21.15DOLE YHC
       Timeline  
Dole PLC 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days Dole PLC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound essential indicators, Dole PLC is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb12.51313.51414.51515.5
LQR House 

Risk-Adjusted Performance

Modest

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in LQR House are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical indicators, LQR House exhibited solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb0.811.21.41.61.822.2

Dole PLC and LQR House Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-2.4-1.81-1.22-0.63-0.040.551.141.732.32 0.050.100.15
JavaScript chart by amCharts 3.21.15DOLE YHC
       Returns  

Pair Trading with Dole PLC and LQR House

The main advantage of trading using opposite Dole PLC and LQR House positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dole PLC position performs unexpectedly, LQR House 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 LQR House will offset losses from the drop in LQR House's long position.
The idea behind Dole PLC and LQR House 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.
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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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.

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