Correlation Between LPKF Laser and FIRST SAVINGS
Can any of the company-specific risk be diversified away by investing in both LPKF Laser and FIRST SAVINGS 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 FIRST SAVINGS 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 FIRST SAVINGS FINL, you can compare the effects of market volatilities on LPKF Laser and FIRST SAVINGS 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 FIRST SAVINGS. Check out your portfolio center. Please also check ongoing floating volatility patterns of LPKF Laser and FIRST SAVINGS.
Diversification Opportunities for LPKF Laser and FIRST SAVINGS
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between LPKF and FIRST is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding LPKF Laser Electronics and FIRST SAVINGS FINL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FIRST SAVINGS FINL 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 FIRST SAVINGS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FIRST SAVINGS FINL has no effect on the direction of LPKF Laser i.e., LPKF Laser and FIRST SAVINGS go up and down completely randomly.
Pair Corralation between LPKF Laser and FIRST SAVINGS
Assuming the 90 days horizon LPKF Laser Electronics is expected to under-perform the FIRST SAVINGS. In addition to that, LPKF Laser is 1.2 times more volatile than FIRST SAVINGS FINL. It trades about -0.01 of its total potential returns per unit of risk. FIRST SAVINGS FINL is currently generating about 0.03 per unit of volatility. If you would invest 1,641 in FIRST SAVINGS FINL on November 9, 2024 and sell it today you would earn a total of 459.00 from holding FIRST SAVINGS FINL or generate 27.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
LPKF Laser Electronics vs. FIRST SAVINGS FINL
Performance |
| Timeline |
| LPKF Laser Electronics |
| FIRST SAVINGS FINL |
LPKF Laser and FIRST SAVINGS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LPKF Laser and FIRST SAVINGS
The main advantage of trading using opposite LPKF Laser and FIRST SAVINGS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LPKF Laser position performs unexpectedly, FIRST SAVINGS 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 FIRST SAVINGS will offset losses from the drop in FIRST SAVINGS's long position.| LPKF Laser vs. ASURE SOFTWARE | LPKF Laser vs. Urban Outfitters | LPKF Laser vs. Magic Software Enterprises | LPKF Laser vs. RYU Apparel |
| FIRST SAVINGS vs. SWISS WATER DECAFFCOFFEE | FIRST SAVINGS vs. CAIRN HOMES EO | FIRST SAVINGS vs. BOSTON BEER A | FIRST SAVINGS vs. Focus Home Interactive |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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