Correlation Between Lumentum Holdings and Movano
Can any of the company-specific risk be diversified away by investing in both Lumentum Holdings and Movano 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 Movano into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lumentum Holdings and Movano Inc, you can compare the effects of market volatilities on Lumentum Holdings and Movano 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 Movano. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lumentum Holdings and Movano.
Diversification Opportunities for Lumentum Holdings and Movano
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Lumentum and Movano is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Lumentum Holdings and Movano Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Movano Inc 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 Movano. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Movano Inc has no effect on the direction of Lumentum Holdings i.e., Lumentum Holdings and Movano go up and down completely randomly.
Pair Corralation between Lumentum Holdings and Movano
Given the investment horizon of 90 days Lumentum Holdings is expected to generate 2.27 times less return on investment than Movano. But when comparing it to its historical volatility, Lumentum Holdings is 2.87 times less risky than Movano. It trades about 0.29 of its potential returns per unit of risk. Movano Inc is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 334.00 in Movano Inc on August 31, 2024 and sell it today you would earn a total of 205.00 from holding Movano Inc or generate 61.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lumentum Holdings vs. Movano Inc
Performance |
| Timeline |
| Lumentum Holdings |
| Movano Inc |
Lumentum Holdings and Movano Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lumentum Holdings and Movano
The main advantage of trading using opposite Lumentum Holdings and Movano positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lumentum Holdings position performs unexpectedly, Movano 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 Movano will offset losses from the drop in Movano's long position.| Lumentum Holdings vs. NETGEAR | Lumentum Holdings vs. KVH Industries | Lumentum Holdings vs. Telesat Corp | Lumentum Holdings vs. Juniper Networks |
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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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