Correlation Between International Business and LL Flooring
Can any of the company-specific risk be diversified away by investing in both International Business and LL Flooring 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 International Business and LL Flooring into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between International Business Machines and LL Flooring Holdings, you can compare the effects of market volatilities on International Business and LL Flooring 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 International Business with a short position of LL Flooring. Check out your portfolio center. Please also check ongoing floating volatility patterns of International Business and LL Flooring.
Diversification Opportunities for International Business and LL Flooring
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between International and LL Flooring is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding International Business Machine and LL Flooring Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LL Flooring Holdings and International Business 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 International Business Machines are associated (or correlated) with LL Flooring. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LL Flooring Holdings has no effect on the direction of International Business i.e., International Business and LL Flooring go up and down completely randomly.
Pair Corralation between International Business and LL Flooring
If you would invest 20,510 in International Business Machines on September 1, 2024 and sell it today you would earn a total of 2,231 from holding International Business Machines or generate 10.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
International Business Machine vs. LL Flooring Holdings
Performance |
| Timeline |
| International Business |
| LL Flooring Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
International Business and LL Flooring Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with International Business and LL Flooring
The main advantage of trading using opposite International Business and LL Flooring positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if International Business position performs unexpectedly, LL Flooring 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 LL Flooring will offset losses from the drop in LL Flooring's long position.| International Business vs. FiscalNote Holdings | International Business vs. Innodata | International Business vs. Aurora Innovation | International Business vs. Conduent |
| LL Flooring vs. Haverty Furniture Companies | LL Flooring vs. Arhaus Inc | LL Flooring vs. Tile Shop Holdings | LL Flooring vs. Floor Decor Holdings |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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