Correlation Between LB Foster and PACIFIC
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By analyzing existing cross correlation between LB Foster and PACIFIC GAS ELECTRIC, you can compare the effects of market volatilities on LB Foster and PACIFIC 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 LB Foster with a short position of PACIFIC. Check out your portfolio center. Please also check ongoing floating volatility patterns of LB Foster and PACIFIC.
Diversification Opportunities for LB Foster and PACIFIC
Good diversification
The 3 months correlation between FSTR and PACIFIC is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding LB Foster and PACIFIC GAS ELECTRIC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PACIFIC GAS ELECTRIC and LB Foster 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 LB Foster are associated (or correlated) with PACIFIC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PACIFIC GAS ELECTRIC has no effect on the direction of LB Foster i.e., LB Foster and PACIFIC go up and down completely randomly.
Pair Corralation between LB Foster and PACIFIC
Given the investment horizon of 90 days LB Foster is expected to generate 3.05 times more return on investment than PACIFIC. However, LB Foster is 3.05 times more volatile than PACIFIC GAS ELECTRIC. It trades about 0.28 of its potential returns per unit of risk. PACIFIC GAS ELECTRIC is currently generating about -0.1 per unit of risk. If you would invest 2,013 in LB Foster on September 12, 2024 and sell it today you would earn a total of 849.00 from holding LB Foster or generate 42.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.12% |
| Values | Daily Returns |
LB Foster vs. PACIFIC GAS ELECTRIC
Performance |
| Timeline |
| LB Foster |
| PACIFIC GAS ELECTRIC |
LB Foster and PACIFIC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LB Foster and PACIFIC
The main advantage of trading using opposite LB Foster and PACIFIC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LB Foster position performs unexpectedly, PACIFIC 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 PACIFIC will offset losses from the drop in PACIFIC's long position.| LB Foster vs. Trinity Industries | LB Foster vs. Freightcar America | LB Foster vs. Westinghouse Air Brake | LB Foster vs. Norfolk Southern |
| PACIFIC vs. Regeneron Pharmaceuticals | PACIFIC vs. Asbury Automotive Group | PACIFIC vs. Weyco Group | PACIFIC vs. Catalyst Pharmaceuticals |
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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