Correlation Between Lululemon Athletica and NORFOLK
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By analyzing existing cross correlation between Lululemon Athletica and NORFOLK SOUTHN P, you can compare the effects of market volatilities on Lululemon Athletica and NORFOLK 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 NORFOLK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lululemon Athletica and NORFOLK.
Diversification Opportunities for Lululemon Athletica and NORFOLK
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Lululemon and NORFOLK is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Lululemon Athletica and NORFOLK SOUTHN P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NORFOLK SOUTHN P 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 NORFOLK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NORFOLK SOUTHN P has no effect on the direction of Lululemon Athletica i.e., Lululemon Athletica and NORFOLK go up and down completely randomly.
Pair Corralation between Lululemon Athletica and NORFOLK
Given the investment horizon of 90 days Lululemon Athletica is expected to generate 1.03 times more return on investment than NORFOLK. However, Lululemon Athletica is 1.03 times more volatile than NORFOLK SOUTHN P. It trades about -0.07 of its potential returns per unit of risk. NORFOLK SOUTHN P is currently generating about -0.24 per unit of risk. If you would invest 38,349 in Lululemon Athletica on October 22, 2024 and sell it today you would lose (979.00) from holding Lululemon Athletica or give up 2.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 42.11% |
| Values | Daily Returns |
Lululemon Athletica vs. NORFOLK SOUTHN P
Performance |
| Timeline |
| Lululemon Athletica |
| NORFOLK SOUTHN P |
Lululemon Athletica and NORFOLK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lululemon Athletica and NORFOLK
The main advantage of trading using opposite Lululemon Athletica and NORFOLK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lululemon Athletica position performs unexpectedly, NORFOLK 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 NORFOLK will offset losses from the drop in NORFOLK's long position.| Lululemon Athletica vs. American Eagle Outfitters | Lululemon Athletica vs. Abercrombie Fitch | Lululemon Athletica vs. Urban Outfitters | Lululemon Athletica vs. Foot Locker |
| NORFOLK vs. Willamette Valley Vineyards | NORFOLK vs. Celsius Holdings | NORFOLK vs. Diageo PLC ADR | NORFOLK vs. Brandywine Realty Trust |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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