Correlation Between Lightspeed Commerce and Suncor Energy
Can any of the company-specific risk be diversified away by investing in both Lightspeed Commerce and Suncor Energy 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 Lightspeed Commerce and Suncor Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lightspeed Commerce and Suncor Energy, you can compare the effects of market volatilities on Lightspeed Commerce and Suncor Energy 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 Lightspeed Commerce with a short position of Suncor Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lightspeed Commerce and Suncor Energy.
Diversification Opportunities for Lightspeed Commerce and Suncor Energy
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lightspeed and Suncor is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Lightspeed Commerce and Suncor Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Suncor Energy and Lightspeed Commerce 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 Lightspeed Commerce are associated (or correlated) with Suncor Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Suncor Energy has no effect on the direction of Lightspeed Commerce i.e., Lightspeed Commerce and Suncor Energy go up and down completely randomly.
Pair Corralation between Lightspeed Commerce and Suncor Energy
Assuming the 90 days trading horizon Lightspeed Commerce is expected to generate 1.88 times more return on investment than Suncor Energy. However, Lightspeed Commerce is 1.88 times more volatile than Suncor Energy. It trades about 0.03 of its potential returns per unit of risk. Suncor Energy is currently generating about 0.05 per unit of risk. If you would invest 2,068 in Lightspeed Commerce on August 29, 2024 and sell it today you would earn a total of 565.00 from holding Lightspeed Commerce or generate 27.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lightspeed Commerce vs. Suncor Energy
Performance |
| Timeline |
| Lightspeed Commerce |
| Suncor Energy |
Lightspeed Commerce and Suncor Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lightspeed Commerce and Suncor Energy
The main advantage of trading using opposite Lightspeed Commerce and Suncor Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lightspeed Commerce position performs unexpectedly, Suncor Energy 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 Suncor Energy will offset losses from the drop in Suncor Energy's long position.| Lightspeed Commerce vs. Shopify | Lightspeed Commerce vs. WELL Health Technologies | Lightspeed Commerce vs. BlackBerry | Lightspeed Commerce vs. Docebo Inc |
| Suncor Energy vs. Enbridge | Suncor Energy vs. Canadian Natural Resources | Suncor Energy vs. Toronto Dominion Bank | Suncor Energy vs. Bank of Nova |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories |