Correlation Between LENSAR and Seaport Entertainment
Can any of the company-specific risk be diversified away by investing in both LENSAR and Seaport Entertainment 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 Seaport Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LENSAR Inc and Seaport Entertainment Group, you can compare the effects of market volatilities on LENSAR and Seaport Entertainment 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 Seaport Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of LENSAR and Seaport Entertainment.
Diversification Opportunities for LENSAR and Seaport Entertainment
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between LENSAR and Seaport is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding LENSAR Inc and Seaport Entertainment Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seaport Entertainment 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 Seaport Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seaport Entertainment has no effect on the direction of LENSAR i.e., LENSAR and Seaport Entertainment go up and down completely randomly.
Pair Corralation between LENSAR and Seaport Entertainment
Given the investment horizon of 90 days LENSAR Inc is expected to generate 0.7 times more return on investment than Seaport Entertainment. However, LENSAR Inc is 1.44 times less risky than Seaport Entertainment. It trades about 0.16 of its potential returns per unit of risk. Seaport Entertainment Group is currently generating about -0.01 per unit of risk. If you would invest 704.00 in LENSAR Inc on September 13, 2024 and sell it today you would earn a total of 63.00 from holding LENSAR Inc or generate 8.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
LENSAR Inc vs. Seaport Entertainment Group
Performance |
| Timeline |
| LENSAR Inc |
| Seaport Entertainment |
LENSAR and Seaport Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LENSAR and Seaport Entertainment
The main advantage of trading using opposite LENSAR and Seaport Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LENSAR position performs unexpectedly, Seaport Entertainment 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 Seaport Entertainment will offset losses from the drop in Seaport Entertainment's long position.| LENSAR vs. Avita Medical | LENSAR vs. Sight Sciences | LENSAR vs. Treace Medical Concepts | LENSAR vs. Neuropace |
| Seaport Entertainment vs. Naked Wines plc | Seaport Entertainment vs. LENSAR Inc | Seaport Entertainment vs. The Joint Corp | Seaport Entertainment vs. Keurig Dr Pepper |
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 Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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