Correlation Between Luminar Technologies and Dana
Can any of the company-specific risk be diversified away by investing in both Luminar Technologies and Dana 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 Luminar Technologies and Dana into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Luminar Technologies and Dana Inc, you can compare the effects of market volatilities on Luminar Technologies and Dana 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 Luminar Technologies with a short position of Dana. Check out your portfolio center. Please also check ongoing floating volatility patterns of Luminar Technologies and Dana.
Diversification Opportunities for Luminar Technologies and Dana
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Luminar and Dana is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Luminar Technologies and Dana Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dana Inc and Luminar Technologies 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 Luminar Technologies are associated (or correlated) with Dana. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dana Inc has no effect on the direction of Luminar Technologies i.e., Luminar Technologies and Dana go up and down completely randomly.
Pair Corralation between Luminar Technologies and Dana
Given the investment horizon of 90 days Luminar Technologies is expected to generate 5.4 times more return on investment than Dana. However, Luminar Technologies is 5.4 times more volatile than Dana Inc. It trades about 0.14 of its potential returns per unit of risk. Dana Inc is currently generating about 0.3 per unit of risk. If you would invest 549.00 in Luminar Technologies on October 20, 2024 and sell it today you would earn a total of 123.00 from holding Luminar Technologies or generate 22.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Luminar Technologies vs. Dana Inc
Performance |
| Timeline |
| Luminar Technologies |
| Dana Inc |
Luminar Technologies and Dana Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Luminar Technologies and Dana
The main advantage of trading using opposite Luminar Technologies and Dana positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Luminar Technologies position performs unexpectedly, Dana 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 Dana will offset losses from the drop in Dana's long position.| Luminar Technologies vs. Mobileye Global Class | Luminar Technologies vs. Hyliion Holdings Corp | Luminar Technologies vs. Aeva Technologies | Luminar Technologies vs. Innoviz Technologies |
| Dana vs. Mobileye Global Class | Dana vs. Innoviz Technologies | Dana vs. Aeva Technologies | Dana vs. Hyliion Holdings Corp |
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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