Correlation Between Loxley Public and AP Public
Can any of the company-specific risk be diversified away by investing in both Loxley Public and AP Public 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 Loxley Public and AP Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Loxley Public and AP Public, you can compare the effects of market volatilities on Loxley Public and AP Public 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 Loxley Public with a short position of AP Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Loxley Public and AP Public.
Diversification Opportunities for Loxley Public and AP Public
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Loxley and AP Public is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Loxley Public and AP Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AP Public and Loxley Public 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 Loxley Public are associated (or correlated) with AP Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AP Public has no effect on the direction of Loxley Public i.e., Loxley Public and AP Public go up and down completely randomly.
Pair Corralation between Loxley Public and AP Public
Assuming the 90 days trading horizon Loxley Public is expected to generate 50.77 times more return on investment than AP Public. However, Loxley Public is 50.77 times more volatile than AP Public. It trades about 0.08 of its potential returns per unit of risk. AP Public is currently generating about -0.02 per unit of risk. If you would invest 155.00 in Loxley Public on August 29, 2024 and sell it today you would lose (17.00) from holding Loxley Public or give up 10.97% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Loxley Public vs. AP Public
Performance |
| Timeline |
| Loxley Public |
| AP Public |
Loxley Public and AP Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Loxley Public and AP Public
The main advantage of trading using opposite Loxley Public and AP Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Loxley Public position performs unexpectedly, AP Public 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 AP Public will offset losses from the drop in AP Public's long position.| Loxley Public vs. AP Public | Loxley Public vs. Jasmine International Public | Loxley Public vs. Asia Plus Group | Loxley Public vs. Bangkok Aviation Fuel |
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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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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