Correlation Between LSI Software and TEN SQUARE
Can any of the company-specific risk be diversified away by investing in both LSI Software and TEN SQUARE 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 TEN SQUARE 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 TEN SQUARE GAMES, you can compare the effects of market volatilities on LSI Software and TEN SQUARE 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 TEN SQUARE. Check out your portfolio center. Please also check ongoing floating volatility patterns of LSI Software and TEN SQUARE.
Diversification Opportunities for LSI Software and TEN SQUARE
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between LSI and TEN is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding LSI Software SA and TEN SQUARE GAMES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TEN SQUARE GAMES 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 TEN SQUARE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TEN SQUARE GAMES has no effect on the direction of LSI Software i.e., LSI Software and TEN SQUARE go up and down completely randomly.
Pair Corralation between LSI Software and TEN SQUARE
Assuming the 90 days trading horizon LSI Software SA is expected to generate 0.75 times more return on investment than TEN SQUARE. However, LSI Software SA is 1.33 times less risky than TEN SQUARE. It trades about 0.16 of its potential returns per unit of risk. TEN SQUARE GAMES is currently generating about -0.04 per unit of risk. If you would invest 1,470 in LSI Software SA on September 1, 2024 and sell it today you would earn a total of 80.00 from holding LSI Software SA or generate 5.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
LSI Software SA vs. TEN SQUARE GAMES
Performance |
| Timeline |
| LSI Software SA |
| TEN SQUARE GAMES |
LSI Software and TEN SQUARE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LSI Software and TEN SQUARE
The main advantage of trading using opposite LSI Software and TEN SQUARE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LSI Software position performs unexpectedly, TEN SQUARE 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 TEN SQUARE will offset losses from the drop in TEN SQUARE's long position.| LSI Software vs. Mlk Foods Public | LSI Software vs. Intersport Polska SA | LSI Software vs. PLAYWAY SA | LSI Software vs. Drago entertainment 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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