Correlation Between LMF Acquisition and Cardio Diagnostics
Can any of the company-specific risk be diversified away by investing in both LMF Acquisition and Cardio Diagnostics 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 LMF Acquisition and Cardio Diagnostics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LMF Acquisition Opportunities and Cardio Diagnostics Holdings, you can compare the effects of market volatilities on LMF Acquisition and Cardio Diagnostics 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 LMF Acquisition with a short position of Cardio Diagnostics. Check out your portfolio center. Please also check ongoing floating volatility patterns of LMF Acquisition and Cardio Diagnostics.
Diversification Opportunities for LMF Acquisition and Cardio Diagnostics
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between LMF and Cardio is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding LMF Acquisition Opportunities and Cardio Diagnostics Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cardio Diagnostics and LMF Acquisition 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 LMF Acquisition Opportunities are associated (or correlated) with Cardio Diagnostics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cardio Diagnostics has no effect on the direction of LMF Acquisition i.e., LMF Acquisition and Cardio Diagnostics go up and down completely randomly.
Pair Corralation between LMF Acquisition and Cardio Diagnostics
Assuming the 90 days horizon LMF Acquisition is expected to generate 5.18 times less return on investment than Cardio Diagnostics. But when comparing it to its historical volatility, LMF Acquisition Opportunities is 4.6 times less risky than Cardio Diagnostics. It trades about 0.08 of its potential returns per unit of risk. Cardio Diagnostics Holdings is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 11.00 in Cardio Diagnostics Holdings on August 31, 2024 and sell it today you would lose (8.00) from holding Cardio Diagnostics Holdings or give up 72.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 79.51% |
| Values | Daily Returns |
LMF Acquisition Opportunities vs. Cardio Diagnostics Holdings
Performance |
| Timeline |
| LMF Acquisition Oppo |
| Cardio Diagnostics |
LMF Acquisition and Cardio Diagnostics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LMF Acquisition and Cardio Diagnostics
The main advantage of trading using opposite LMF Acquisition and Cardio Diagnostics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LMF Acquisition position performs unexpectedly, Cardio Diagnostics 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 Cardio Diagnostics will offset losses from the drop in Cardio Diagnostics' long position.| LMF Acquisition vs. LMF Acquisition Opportunities | LMF Acquisition vs. Cardio Diagnostics Holdings | LMF Acquisition vs. Revelation Biosciences | LMF Acquisition vs. OmniAb Inc |
| Cardio Diagnostics vs. Cardio Diagnostics Holdings | Cardio Diagnostics vs. Revelation Biosciences | Cardio Diagnostics vs. LMF Acquisition Opportunities | Cardio Diagnostics vs. OmniAb Inc |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
Other Complementary Tools
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |