Correlation Between NexteGO NV and Lululemon Athletica
Can any of the company-specific risk be diversified away by investing in both NexteGO NV and Lululemon Athletica 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 NexteGO NV and Lululemon Athletica into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NexteGO NV Ordinary and Lululemon Athletica, you can compare the effects of market volatilities on NexteGO NV and Lululemon Athletica 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 NexteGO NV with a short position of Lululemon Athletica. Check out your portfolio center. Please also check ongoing floating volatility patterns of NexteGO NV and Lululemon Athletica.
Diversification Opportunities for NexteGO NV and Lululemon Athletica
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between NexteGO and Lululemon is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding NexteGO NV Ordinary and Lululemon Athletica in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lululemon Athletica and NexteGO NV 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 NexteGO NV Ordinary are associated (or correlated) with Lululemon Athletica. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lululemon Athletica has no effect on the direction of NexteGO NV i.e., NexteGO NV and Lululemon Athletica go up and down completely randomly.
Pair Corralation between NexteGO NV and Lululemon Athletica
If you would invest 0.01 in NexteGO NV Ordinary on November 27, 2024 and sell it today you would earn a total of 0.00 from holding NexteGO NV Ordinary or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NexteGO NV Ordinary vs. Lululemon Athletica
Performance |
| Timeline |
| NexteGO NV Ordinary |
| Lululemon Athletica |
NexteGO NV and Lululemon Athletica Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NexteGO NV and Lululemon Athletica
The main advantage of trading using opposite NexteGO NV and Lululemon Athletica positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NexteGO NV position performs unexpectedly, Lululemon Athletica 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 Lululemon Athletica will offset losses from the drop in Lululemon Athletica's long position.| NexteGO NV vs. Canlan Ice Sports | NexteGO NV vs. JD Sports Fashion | NexteGO NV vs. Insteel Industries | NexteGO NV vs. Barrick Gold Corp |
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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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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