Correlation Between Lument Finance and Ecc Cap
Can any of the company-specific risk be diversified away by investing in both Lument Finance and Ecc Cap 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 Lument Finance and Ecc Cap into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lument Finance Trust and Ecc Cap Corp, you can compare the effects of market volatilities on Lument Finance and Ecc Cap 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 Lument Finance with a short position of Ecc Cap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lument Finance and Ecc Cap.
Diversification Opportunities for Lument Finance and Ecc Cap
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lument and Ecc is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Lument Finance Trust and Ecc Cap Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ecc Cap Corp and Lument Finance 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 Lument Finance Trust are associated (or correlated) with Ecc Cap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ecc Cap Corp has no effect on the direction of Lument Finance i.e., Lument Finance and Ecc Cap go up and down completely randomly.
Pair Corralation between Lument Finance and Ecc Cap
If you would invest 2.00 in Ecc Cap Corp on August 30, 2024 and sell it today you would earn a total of 0.00 from holding Ecc Cap Corp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.55% |
| Values | Daily Returns |
Lument Finance Trust vs. Ecc Cap Corp
Performance |
| Timeline |
| Lument Finance Trust |
| Ecc Cap Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Lument Finance and Ecc Cap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lument Finance and Ecc Cap
The main advantage of trading using opposite Lument Finance and Ecc Cap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lument Finance position performs unexpectedly, Ecc Cap 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 Ecc Cap will offset losses from the drop in Ecc Cap's long position.| Lument Finance vs. ACRES Commercial Realty | Lument Finance vs. ACRES Commercial Realty | Lument Finance vs. KKR Real Estate | Lument Finance vs. NexPoint Real Estate |
| Ecc Cap vs. Ready Capital Corp | Ecc Cap vs. Ellington Residential Mortgage | Ecc Cap vs. Ellington Financial | Ecc Cap vs. Dynex Capital |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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