Correlation Between Lumine and Diagnos
Can any of the company-specific risk be diversified away by investing in both Lumine and Diagnos 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 Lumine and Diagnos into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lumine Group and Diagnos, you can compare the effects of market volatilities on Lumine and Diagnos 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 Lumine with a short position of Diagnos. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lumine and Diagnos.
Diversification Opportunities for Lumine and Diagnos
Very good diversification
The 3 months correlation between Lumine and Diagnos is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Lumine Group and Diagnos in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Diagnos and Lumine 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 Lumine Group are associated (or correlated) with Diagnos. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Diagnos has no effect on the direction of Lumine i.e., Lumine and Diagnos go up and down completely randomly.
Pair Corralation between Lumine and Diagnos
Assuming the 90 days horizon Lumine Group is expected to generate 0.68 times more return on investment than Diagnos. However, Lumine Group is 1.46 times less risky than Diagnos. It trades about 0.07 of its potential returns per unit of risk. Diagnos is currently generating about 0.0 per unit of risk. If you would invest 3,290 in Lumine Group on November 2, 2024 and sell it today you would earn a total of 530.00 from holding Lumine Group or generate 16.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.05% |
| Values | Daily Returns |
Lumine Group vs. Diagnos
Performance |
| Timeline |
| Lumine Group |
| Diagnos |
Lumine and Diagnos Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lumine and Diagnos
The main advantage of trading using opposite Lumine and Diagnos positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lumine position performs unexpectedly, Diagnos 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 Diagnos will offset losses from the drop in Diagnos' long position.| Lumine vs. Topicus | Lumine vs. Constellation Software | Lumine vs. Brookfield | Lumine vs. Brookfield Asset Management |
| Diagnos vs. VentriPoint Diagnostics | Diagnos vs. AnalytixInsight | Diagnos vs. Theralase Technologies | Diagnos vs. Eguana Technologies |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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