Correlation Between LPKF Laser and BOYD GROUP
Can any of the company-specific risk be diversified away by investing in both LPKF Laser and BOYD GROUP 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 LPKF Laser and BOYD GROUP into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LPKF Laser Electronics and BOYD GROUP SERVICES, you can compare the effects of market volatilities on LPKF Laser and BOYD GROUP 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 LPKF Laser with a short position of BOYD GROUP. Check out your portfolio center. Please also check ongoing floating volatility patterns of LPKF Laser and BOYD GROUP.
Diversification Opportunities for LPKF Laser and BOYD GROUP
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between LPKF and BOYD is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding LPKF Laser Electronics and BOYD GROUP SERVICES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BOYD GROUP SERVICES and LPKF Laser 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 LPKF Laser Electronics are associated (or correlated) with BOYD GROUP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BOYD GROUP SERVICES has no effect on the direction of LPKF Laser i.e., LPKF Laser and BOYD GROUP go up and down completely randomly.
Pair Corralation between LPKF Laser and BOYD GROUP
Assuming the 90 days horizon LPKF Laser Electronics is expected to generate 2.95 times more return on investment than BOYD GROUP. However, LPKF Laser is 2.95 times more volatile than BOYD GROUP SERVICES. It trades about 0.0 of its potential returns per unit of risk. BOYD GROUP SERVICES is currently generating about -0.13 per unit of risk. If you would invest 855.00 in LPKF Laser Electronics on September 13, 2024 and sell it today you would lose (22.00) from holding LPKF Laser Electronics or give up 2.57% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
LPKF Laser Electronics vs. BOYD GROUP SERVICES
Performance |
| Timeline |
| LPKF Laser Electronics |
| BOYD GROUP SERVICES |
LPKF Laser and BOYD GROUP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LPKF Laser and BOYD GROUP
The main advantage of trading using opposite LPKF Laser and BOYD GROUP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LPKF Laser position performs unexpectedly, BOYD GROUP 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 BOYD GROUP will offset losses from the drop in BOYD GROUP's long position.| LPKF Laser vs. Schneider Electric SE | LPKF Laser vs. Superior Plus Corp | LPKF Laser vs. SIVERS SEMICONDUCTORS AB | LPKF Laser vs. Norsk Hydro ASA |
| BOYD GROUP vs. Fair Isaac Corp | BOYD GROUP vs. SYSTEMAIR AB | BOYD GROUP vs. CDL INVESTMENT | BOYD GROUP vs. Ryanair Holdings plc |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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