Correlation Between LSI Software and Dino Polska
Can any of the company-specific risk be diversified away by investing in both LSI Software and Dino Polska 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 LSI Software and Dino Polska into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LSI Software SA and Dino Polska SA, you can compare the effects of market volatilities on LSI Software and Dino Polska 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 LSI Software with a short position of Dino Polska. Check out your portfolio center. Please also check ongoing floating volatility patterns of LSI Software and Dino Polska.
Diversification Opportunities for LSI Software and Dino Polska
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between LSI and Dino is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding LSI Software SA and Dino Polska SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dino Polska SA and LSI Software 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 LSI Software SA are associated (or correlated) with Dino Polska. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dino Polska SA has no effect on the direction of LSI Software i.e., LSI Software and Dino Polska go up and down completely randomly.
Pair Corralation between LSI Software and Dino Polska
Assuming the 90 days trading horizon LSI Software SA is expected to generate 0.86 times more return on investment than Dino Polska. However, LSI Software SA is 1.16 times less risky than Dino Polska. It trades about 0.04 of its potential returns per unit of risk. Dino Polska SA is currently generating about -0.01 per unit of risk. If you would invest 1,366 in LSI Software SA on September 12, 2024 and sell it today you would earn a total of 294.00 from holding LSI Software SA or generate 21.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.72% |
| Values | Daily Returns |
LSI Software SA vs. Dino Polska SA
Performance |
| Timeline |
| LSI Software SA |
| Dino Polska SA |
LSI Software and Dino Polska Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LSI Software and Dino Polska
The main advantage of trading using opposite LSI Software and Dino Polska positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LSI Software position performs unexpectedly, Dino Polska 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 Dino Polska will offset losses from the drop in Dino Polska's long position.| LSI Software vs. Skyline Investment SA | LSI Software vs. Immobile | LSI Software vs. Road Studio SA | LSI Software vs. MCI Management SA |
| Dino Polska vs. LSI Software SA | Dino Polska vs. Alior Bank SA | Dino Polska vs. Medicofarma Biotech SA | Dino Polska vs. Santander Bank Polska |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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