Correlation Between LENSAR and ChampionX
Can any of the company-specific risk be diversified away by investing in both LENSAR and ChampionX 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 LENSAR and ChampionX into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LENSAR Inc and ChampionX, you can compare the effects of market volatilities on LENSAR and ChampionX 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 LENSAR with a short position of ChampionX. Check out your portfolio center. Please also check ongoing floating volatility patterns of LENSAR and ChampionX.
Diversification Opportunities for LENSAR and ChampionX
Average diversification
The 3 months correlation between LENSAR and ChampionX is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding LENSAR Inc and ChampionX in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ChampionX and LENSAR 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 LENSAR Inc are associated (or correlated) with ChampionX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ChampionX has no effect on the direction of LENSAR i.e., LENSAR and ChampionX go up and down completely randomly.
Pair Corralation between LENSAR and ChampionX
Given the investment horizon of 90 days LENSAR Inc is expected to generate 2.15 times more return on investment than ChampionX. However, LENSAR is 2.15 times more volatile than ChampionX. It trades about 0.32 of its potential returns per unit of risk. ChampionX is currently generating about 0.13 per unit of risk. If you would invest 530.00 in LENSAR Inc on August 26, 2024 and sell it today you would earn a total of 208.00 from holding LENSAR Inc or generate 39.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
LENSAR Inc vs. ChampionX
Performance |
| Timeline |
| LENSAR Inc |
| ChampionX |
LENSAR and ChampionX Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LENSAR and ChampionX
The main advantage of trading using opposite LENSAR and ChampionX positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LENSAR position performs unexpectedly, ChampionX 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 ChampionX will offset losses from the drop in ChampionX's long position.| LENSAR vs. Heartbeam | LENSAR vs. EUDA Health Holdings | LENSAR vs. Nutex Health | LENSAR vs. Healthcare Triangle |
| ChampionX vs. Expro Group Holdings | ChampionX vs. Ranger Energy Services | ChampionX vs. Cactus Inc | ChampionX vs. MRC Global |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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