Correlation Between LPKF Laser and Superior Plus
Can any of the company-specific risk be diversified away by investing in both LPKF Laser and Superior Plus 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 Superior Plus 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 Superior Plus Corp, you can compare the effects of market volatilities on LPKF Laser and Superior Plus 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 Superior Plus. Check out your portfolio center. Please also check ongoing floating volatility patterns of LPKF Laser and Superior Plus.
Diversification Opportunities for LPKF Laser and Superior Plus
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between LPKF and Superior is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding LPKF Laser Electronics and Superior Plus Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Superior Plus Corp 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 Superior Plus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Superior Plus Corp has no effect on the direction of LPKF Laser i.e., LPKF Laser and Superior Plus go up and down completely randomly.
Pair Corralation between LPKF Laser and Superior Plus
Assuming the 90 days horizon LPKF Laser Electronics is expected to generate 1.05 times more return on investment than Superior Plus. However, LPKF Laser is 1.05 times more volatile than Superior Plus Corp. It trades about 0.0 of its potential returns per unit of risk. Superior Plus Corp is currently generating about -0.05 per unit of risk. If you would invest 921.00 in LPKF Laser Electronics on August 24, 2024 and sell it today you would lose (83.00) from holding LPKF Laser Electronics or give up 9.01% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
LPKF Laser Electronics vs. Superior Plus Corp
Performance |
| Timeline |
| LPKF Laser Electronics |
| Superior Plus Corp |
LPKF Laser and Superior Plus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LPKF Laser and Superior Plus
The main advantage of trading using opposite LPKF Laser and Superior Plus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LPKF Laser position performs unexpectedly, Superior Plus 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 Superior Plus will offset losses from the drop in Superior Plus' long position.| LPKF Laser vs. Superior Plus Corp | LPKF Laser vs. NMI Holdings | LPKF Laser vs. Origin Agritech | LPKF Laser vs. SIVERS SEMICONDUCTORS AB |
| Superior Plus vs. SBI Insurance Group | Superior Plus vs. Ping An Insurance | Superior Plus vs. Safety Insurance Group | Superior Plus vs. MSAD INSURANCE |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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