Correlation Between Lisi SA and Exel Industries
Can any of the company-specific risk be diversified away by investing in both Lisi SA and Exel Industries 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 Lisi SA and Exel Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lisi SA and Exel Industries, you can compare the effects of market volatilities on Lisi SA and Exel Industries 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 Lisi SA with a short position of Exel Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lisi SA and Exel Industries.
Diversification Opportunities for Lisi SA and Exel Industries
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Lisi and Exel is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Lisi SA and Exel Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Exel Industries and Lisi SA 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 Lisi SA are associated (or correlated) with Exel Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Exel Industries has no effect on the direction of Lisi SA i.e., Lisi SA and Exel Industries go up and down completely randomly.
Pair Corralation between Lisi SA and Exel Industries
Assuming the 90 days trading horizon Lisi SA is expected to under-perform the Exel Industries. In addition to that, Lisi SA is 1.42 times more volatile than Exel Industries. It trades about -0.36 of its total potential returns per unit of risk. Exel Industries is currently generating about -0.05 per unit of volatility. If you would invest 4,730 in Exel Industries on August 26, 2024 and sell it today you would lose (50.00) from holding Exel Industries or give up 1.06% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lisi SA vs. Exel Industries
Performance |
| Timeline |
| Lisi SA |
| Exel Industries |
Lisi SA and Exel Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lisi SA and Exel Industries
The main advantage of trading using opposite Lisi SA and Exel Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lisi SA position performs unexpectedly, Exel Industries 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 Exel Industries will offset losses from the drop in Exel Industries' long position.The idea behind Lisi SA and Exel Industries 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.| Exel Industries vs. Manitou BF SA | Exel Industries vs. Lisi SA | Exel Industries vs. Guerbet S A | Exel Industries vs. Haulotte Group SA |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
Other Complementary Tools
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |