Correlation Between Lumentum Holdings and Intevac
Can any of the company-specific risk be diversified away by investing in both Lumentum Holdings and Intevac 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 Lumentum Holdings and Intevac into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lumentum Holdings and Intevac, you can compare the effects of market volatilities on Lumentum Holdings and Intevac 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 Lumentum Holdings with a short position of Intevac. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lumentum Holdings and Intevac.
Diversification Opportunities for Lumentum Holdings and Intevac
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Lumentum and Intevac is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Lumentum Holdings and Intevac in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intevac and Lumentum Holdings 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 Lumentum Holdings are associated (or correlated) with Intevac. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intevac has no effect on the direction of Lumentum Holdings i.e., Lumentum Holdings and Intevac go up and down completely randomly.
Pair Corralation between Lumentum Holdings and Intevac
Given the investment horizon of 90 days Lumentum Holdings is expected to generate 3.96 times more return on investment than Intevac. However, Lumentum Holdings is 3.96 times more volatile than Intevac. It trades about 0.03 of its potential returns per unit of risk. Intevac is currently generating about 0.07 per unit of risk. If you would invest 8,560 in Lumentum Holdings on November 3, 2024 and sell it today you would lose (54.00) from holding Lumentum Holdings or give up 0.63% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lumentum Holdings vs. Intevac
Performance |
| Timeline |
| Lumentum Holdings |
| Intevac |
Lumentum Holdings and Intevac Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lumentum Holdings and Intevac
The main advantage of trading using opposite Lumentum Holdings and Intevac positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lumentum Holdings position performs unexpectedly, Intevac 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 Intevac will offset losses from the drop in Intevac's long position.| Lumentum Holdings vs. NETGEAR | Lumentum Holdings vs. KVH Industries | Lumentum Holdings vs. Telesat Corp | Lumentum Holdings vs. Juniper Networks |
| Intevac vs. Innovative Solutions and | Intevac vs. Heidrick Struggles International | Intevac vs. ICF International | Intevac vs. PDF Solutions |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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