Correlation Between Lite Access and NEXE Innovations
Can any of the company-specific risk be diversified away by investing in both Lite Access and NEXE Innovations 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 Lite Access and NEXE Innovations into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lite Access Technologies and NEXE Innovations, you can compare the effects of market volatilities on Lite Access and NEXE Innovations 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 Lite Access with a short position of NEXE Innovations. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lite Access and NEXE Innovations.
Diversification Opportunities for Lite Access and NEXE Innovations
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Lite and NEXE is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Lite Access Technologies and NEXE Innovations in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NEXE Innovations and Lite Access 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 Lite Access Technologies are associated (or correlated) with NEXE Innovations. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NEXE Innovations has no effect on the direction of Lite Access i.e., Lite Access and NEXE Innovations go up and down completely randomly.
Pair Corralation between Lite Access and NEXE Innovations
Assuming the 90 days horizon Lite Access is expected to generate 1.33 times less return on investment than NEXE Innovations. But when comparing it to its historical volatility, Lite Access Technologies is 1.57 times less risky than NEXE Innovations. It trades about 0.05 of its potential returns per unit of risk. NEXE Innovations is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 28.00 in NEXE Innovations on September 3, 2024 and sell it today you would earn a total of 12.00 from holding NEXE Innovations or generate 42.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lite Access Technologies vs. NEXE Innovations
Performance |
| Timeline |
| Lite Access Technologies |
| NEXE Innovations |
Lite Access and NEXE Innovations Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lite Access and NEXE Innovations
The main advantage of trading using opposite Lite Access and NEXE Innovations positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lite Access position performs unexpectedly, NEXE Innovations 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 NEXE Innovations will offset losses from the drop in NEXE Innovations' long position.| Lite Access vs. Braille Energy Systems | Lite Access vs. Manganese X Energy | Lite Access vs. Solar Alliance Energy | Lite Access vs. Therma Bright |
| NEXE Innovations vs. Algoma Steel Group | NEXE Innovations vs. Champion Iron | NEXE Innovations vs. International Zeolite Corp | NEXE Innovations vs. European Residential Real |
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 Stocks Directory module to find actively traded stocks across global markets.
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