Correlation Between Lululemon Athletica and BOEING
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By analyzing existing cross correlation between Lululemon Athletica and BOEING CO, you can compare the effects of market volatilities on Lululemon Athletica and BOEING 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 Lululemon Athletica with a short position of BOEING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lululemon Athletica and BOEING.
Diversification Opportunities for Lululemon Athletica and BOEING
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Lululemon and BOEING is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Lululemon Athletica and BOEING CO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BOEING CO and Lululemon Athletica 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 Lululemon Athletica are associated (or correlated) with BOEING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BOEING CO has no effect on the direction of Lululemon Athletica i.e., Lululemon Athletica and BOEING go up and down completely randomly.
Pair Corralation between Lululemon Athletica and BOEING
Given the investment horizon of 90 days Lululemon Athletica is expected to generate 5.47 times more return on investment than BOEING. However, Lululemon Athletica is 5.47 times more volatile than BOEING CO. It trades about 0.07 of its potential returns per unit of risk. BOEING CO is currently generating about -0.13 per unit of risk. If you would invest 30,754 in Lululemon Athletica on August 29, 2024 and sell it today you would earn a total of 1,130 from holding Lululemon Athletica or generate 3.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Lululemon Athletica vs. BOEING CO
Performance |
| Timeline |
| Lululemon Athletica |
| BOEING CO |
Lululemon Athletica and BOEING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lululemon Athletica and BOEING
The main advantage of trading using opposite Lululemon Athletica and BOEING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lululemon Athletica position performs unexpectedly, BOEING 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 BOEING will offset losses from the drop in BOEING's long position.| Lululemon Athletica vs. American Eagle Outfitters | Lululemon Athletica vs. Abercrombie Fitch | Lululemon Athletica vs. Urban Outfitters | Lululemon Athletica vs. Foot Locker |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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