Correlation Between Lycos Energy and Magellan Aerospace
Can any of the company-specific risk be diversified away by investing in both Lycos Energy and Magellan Aerospace 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 Lycos Energy and Magellan Aerospace into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lycos Energy and Magellan Aerospace, you can compare the effects of market volatilities on Lycos Energy and Magellan Aerospace 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 Lycos Energy with a short position of Magellan Aerospace. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lycos Energy and Magellan Aerospace.
Diversification Opportunities for Lycos Energy and Magellan Aerospace
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Lycos and Magellan is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Lycos Energy and Magellan Aerospace in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Magellan Aerospace and Lycos Energy 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 Lycos Energy are associated (or correlated) with Magellan Aerospace. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Magellan Aerospace has no effect on the direction of Lycos Energy i.e., Lycos Energy and Magellan Aerospace go up and down completely randomly.
Pair Corralation between Lycos Energy and Magellan Aerospace
Assuming the 90 days horizon Lycos Energy is expected to under-perform the Magellan Aerospace. In addition to that, Lycos Energy is 1.71 times more volatile than Magellan Aerospace. It trades about 0.0 of its total potential returns per unit of risk. Magellan Aerospace is currently generating about 0.06 per unit of volatility. If you would invest 790.00 in Magellan Aerospace on August 31, 2024 and sell it today you would earn a total of 286.00 from holding Magellan Aerospace or generate 36.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lycos Energy vs. Magellan Aerospace
Performance |
| Timeline |
| Lycos Energy |
| Magellan Aerospace |
Lycos Energy and Magellan Aerospace Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lycos Energy and Magellan Aerospace
The main advantage of trading using opposite Lycos Energy and Magellan Aerospace positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lycos Energy position performs unexpectedly, Magellan Aerospace 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 Magellan Aerospace will offset losses from the drop in Magellan Aerospace's long position.| Lycos Energy vs. Aya Gold Silver | Lycos Energy vs. Metalero Mining Corp | Lycos Energy vs. Plaza Retail REIT | Lycos Energy vs. Altair Resources |
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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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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