Correlation Between LSI Software and Esotiq Henderson
Can any of the company-specific risk be diversified away by investing in both LSI Software and Esotiq Henderson 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 Esotiq Henderson 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 Esotiq Henderson SA, you can compare the effects of market volatilities on LSI Software and Esotiq Henderson 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 Esotiq Henderson. Check out your portfolio center. Please also check ongoing floating volatility patterns of LSI Software and Esotiq Henderson.
Diversification Opportunities for LSI Software and Esotiq Henderson
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between LSI and Esotiq is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding LSI Software SA and Esotiq Henderson SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Esotiq Henderson 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 Esotiq Henderson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Esotiq Henderson has no effect on the direction of LSI Software i.e., LSI Software and Esotiq Henderson go up and down completely randomly.
Pair Corralation between LSI Software and Esotiq Henderson
Assuming the 90 days trading horizon LSI Software is expected to generate 1.71 times less return on investment than Esotiq Henderson. But when comparing it to its historical volatility, LSI Software SA is 1.09 times less risky than Esotiq Henderson. It trades about 0.03 of its potential returns per unit of risk. Esotiq Henderson SA is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 2,884 in Esotiq Henderson SA on September 2, 2024 and sell it today you would earn a total of 1,136 from holding Esotiq Henderson SA or generate 39.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.73% |
| Values | Daily Returns |
LSI Software SA vs. Esotiq Henderson SA
Performance |
| Timeline |
| LSI Software SA |
| Esotiq Henderson |
LSI Software and Esotiq Henderson Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LSI Software and Esotiq Henderson
The main advantage of trading using opposite LSI Software and Esotiq Henderson positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LSI Software position performs unexpectedly, Esotiq Henderson 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 Esotiq Henderson will offset losses from the drop in Esotiq Henderson's long position.| LSI Software vs. Biztech Konsulting SA | LSI Software vs. Gaming Factory SA | LSI Software vs. Tower Investments SA | LSI Software vs. Quantum Software SA |
| Esotiq Henderson vs. BNP Paribas Bank | Esotiq Henderson vs. PLAYWAY SA | Esotiq Henderson vs. Alior Bank SA | Esotiq Henderson vs. UniCredit SpA |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Other Complementary Tools
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |