Correlation Between LumiraDx and SeqLL
Can any of the company-specific risk be diversified away by investing in both LumiraDx and SeqLL 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 LumiraDx and SeqLL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LumiraDx and SeqLL Inc, you can compare the effects of market volatilities on LumiraDx and SeqLL 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 LumiraDx with a short position of SeqLL. Check out your portfolio center. Please also check ongoing floating volatility patterns of LumiraDx and SeqLL.
Diversification Opportunities for LumiraDx and SeqLL
Good diversification
The 3 months correlation between LumiraDx and SeqLL is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding LumiraDx and SeqLL Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SeqLL Inc and LumiraDx 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 LumiraDx are associated (or correlated) with SeqLL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SeqLL Inc has no effect on the direction of LumiraDx i.e., LumiraDx and SeqLL go up and down completely randomly.
Pair Corralation between LumiraDx and SeqLL
Given the investment horizon of 90 days LumiraDx is expected to under-perform the SeqLL. But the stock apears to be less risky and, when comparing its historical volatility, LumiraDx is 2.8 times less risky than SeqLL. The stock trades about -0.06 of its potential returns per unit of risk. The SeqLL Inc is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 40.00 in SeqLL Inc on August 29, 2024 and sell it today you would lose (1.00) from holding SeqLL Inc or give up 2.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
LumiraDx vs. SeqLL Inc
Performance |
| Timeline |
| LumiraDx |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| SeqLL Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
LumiraDx and SeqLL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LumiraDx and SeqLL
The main advantage of trading using opposite LumiraDx and SeqLL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LumiraDx position performs unexpectedly, SeqLL 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 SeqLL will offset losses from the drop in SeqLL's long position.| LumiraDx vs. Fonar | LumiraDx vs. Burning Rock Biotech | LumiraDx vs. Sera Prognostics | LumiraDx vs. Exagen Inc |
| SeqLL vs. Agilent Technologies | SeqLL vs. Genetic Technologies | SeqLL vs. T2 Biosystms | SeqLL vs. iSpecimen |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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