Correlation Between Discount Print and Lucas GC
Can any of the company-specific risk be diversified away by investing in both Discount Print and Lucas GC 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 Discount Print and Lucas GC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Discount Print USA and Lucas GC Limited, you can compare the effects of market volatilities on Discount Print and Lucas GC 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 Discount Print with a short position of Lucas GC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Discount Print and Lucas GC.
Diversification Opportunities for Discount Print and Lucas GC
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Discount and Lucas is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Discount Print USA and Lucas GC Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lucas GC Limited and Discount Print 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 Discount Print USA are associated (or correlated) with Lucas GC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lucas GC Limited has no effect on the direction of Discount Print i.e., Discount Print and Lucas GC go up and down completely randomly.
Pair Corralation between Discount Print and Lucas GC
Given the investment horizon of 90 days Discount Print USA is expected to generate 3.69 times more return on investment than Lucas GC. However, Discount Print is 3.69 times more volatile than Lucas GC Limited. It trades about 0.06 of its potential returns per unit of risk. Lucas GC Limited is currently generating about -0.07 per unit of risk. If you would invest 0.69 in Discount Print USA on September 12, 2024 and sell it today you would lose (0.67) from holding Discount Print USA or give up 97.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 39.68% |
| Values | Daily Returns |
Discount Print USA vs. Lucas GC Limited
Performance |
| Timeline |
| Discount Print USA |
| Lucas GC Limited |
Discount Print and Lucas GC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Discount Print and Lucas GC
The main advantage of trading using opposite Discount Print and Lucas GC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Discount Print position performs unexpectedly, Lucas GC 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 Lucas GC will offset losses from the drop in Lucas GC's long position.| Discount Print vs. Cintas | Discount Print vs. Thomson Reuters Corp | Discount Print vs. Global Payments | Discount Print vs. RB Global |
| Lucas GC vs. Everspin Technologies | Lucas GC vs. PennantPark Floating Rate | Lucas GC vs. MACOM Technology Solutions | Lucas GC vs. Amkor Technology |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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