Correlation Between LSI Software and Monnari Trade
Can any of the company-specific risk be diversified away by investing in both LSI Software and Monnari Trade 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 Monnari Trade 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 Monnari Trade SA, you can compare the effects of market volatilities on LSI Software and Monnari Trade 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 Monnari Trade. Check out your portfolio center. Please also check ongoing floating volatility patterns of LSI Software and Monnari Trade.
Diversification Opportunities for LSI Software and Monnari Trade
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between LSI and Monnari is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding LSI Software SA and Monnari Trade SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Monnari Trade 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 Monnari Trade. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Monnari Trade SA has no effect on the direction of LSI Software i.e., LSI Software and Monnari Trade go up and down completely randomly.
Pair Corralation between LSI Software and Monnari Trade
Assuming the 90 days trading horizon LSI Software SA is expected to generate 1.18 times more return on investment than Monnari Trade. However, LSI Software is 1.18 times more volatile than Monnari Trade SA. It trades about -0.03 of its potential returns per unit of risk. Monnari Trade SA is currently generating about -0.23 per unit of risk. If you would invest 1,530 in LSI Software SA on August 29, 2024 and sell it today you would lose (20.00) from holding LSI Software SA or give up 1.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
LSI Software SA vs. Monnari Trade SA
Performance |
| Timeline |
| LSI Software SA |
| Monnari Trade SA |
LSI Software and Monnari Trade Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LSI Software and Monnari Trade
The main advantage of trading using opposite LSI Software and Monnari Trade positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LSI Software position performs unexpectedly, Monnari Trade 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 Monnari Trade will offset losses from the drop in Monnari Trade's long position.| LSI Software vs. Asseco Poland SA | LSI Software vs. Asseco Business Solutions | LSI Software vs. Quantum Software SA |
| Monnari Trade vs. Pixel Crow Games | Monnari Trade vs. True Games Syndicate | Monnari Trade vs. LSI Software SA | Monnari Trade vs. Tower Investments SA |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges |