Correlation Between Lighting Science and Erayak Power
Can any of the company-specific risk be diversified away by investing in both Lighting Science and Erayak Power 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 Lighting Science and Erayak Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lighting Science Group and Erayak Power Solution, you can compare the effects of market volatilities on Lighting Science and Erayak Power 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 Lighting Science with a short position of Erayak Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lighting Science and Erayak Power.
Diversification Opportunities for Lighting Science and Erayak Power
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Lighting and Erayak is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Lighting Science Group and Erayak Power Solution in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Erayak Power Solution and Lighting Science 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 Lighting Science Group are associated (or correlated) with Erayak Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Erayak Power Solution has no effect on the direction of Lighting Science i.e., Lighting Science and Erayak Power go up and down completely randomly.
Pair Corralation between Lighting Science and Erayak Power
If you would invest 127.00 in Erayak Power Solution on November 28, 2024 and sell it today you would earn a total of 3.00 from holding Erayak Power Solution or generate 2.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Lighting Science Group vs. Erayak Power Solution
Performance |
| Timeline |
| Lighting Science |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
| Erayak Power Solution |
Lighting Science and Erayak Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lighting Science and Erayak Power
The main advantage of trading using opposite Lighting Science and Erayak Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lighting Science position performs unexpectedly, Erayak Power 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 Erayak Power will offset losses from the drop in Erayak Power's long position.| Lighting Science vs. Polar Power | Lighting Science vs. CBAK Energy Technology | Lighting Science vs. Ocean Power Technologies | Lighting Science vs. Enersys |
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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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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