Correlation Between Lightbridge Corp and Eos Energy
Can any of the company-specific risk be diversified away by investing in both Lightbridge Corp and Eos 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 Lightbridge Corp and Eos Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lightbridge Corp and Eos Energy Enterprises, you can compare the effects of market volatilities on Lightbridge Corp and Eos 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 Lightbridge Corp with a short position of Eos Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lightbridge Corp and Eos Energy.
Diversification Opportunities for Lightbridge Corp and Eos Energy
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Lightbridge and Eos is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Lightbridge Corp and Eos Energy Enterprises in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eos Energy Enterprises and Lightbridge Corp 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 Lightbridge Corp are associated (or correlated) with Eos Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eos Energy Enterprises has no effect on the direction of Lightbridge Corp i.e., Lightbridge Corp and Eos Energy go up and down completely randomly.
Pair Corralation between Lightbridge Corp and Eos Energy
Given the investment horizon of 90 days Lightbridge Corp is expected to generate 1.13 times less return on investment than Eos Energy. In addition to that, Lightbridge Corp is 1.41 times more volatile than Eos Energy Enterprises. It trades about 0.11 of its total potential returns per unit of risk. Eos Energy Enterprises is currently generating about 0.18 per unit of volatility. If you would invest 74.00 in Eos Energy Enterprises on August 31, 2024 and sell it today you would earn a total of 221.00 from holding Eos Energy Enterprises or generate 298.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lightbridge Corp vs. Eos Energy Enterprises
Performance |
| Timeline |
| Lightbridge Corp |
| Eos Energy Enterprises |
Lightbridge Corp and Eos Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lightbridge Corp and Eos Energy
The main advantage of trading using opposite Lightbridge Corp and Eos Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lightbridge Corp position performs unexpectedly, Eos 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 Eos Energy will offset losses from the drop in Eos Energy's long position.| Lightbridge Corp vs. Espey Mfg Electronics | Lightbridge Corp vs. Hayward Holdings | Lightbridge Corp vs. Kimball Electronics | Lightbridge Corp vs. NeoVolta Warrant |
| Eos Energy vs. FREYR Battery SA | Eos Energy vs. Microvast Holdings | Eos Energy vs. Chardan NexTech Acquisition | Eos Energy vs. Solid Power |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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