Correlation Between Lululemon Athletica and PHILIP
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By analyzing existing cross correlation between Lululemon Athletica and PHILIP MORRIS INTERNATIONAL, you can compare the effects of market volatilities on Lululemon Athletica and PHILIP 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 PHILIP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lululemon Athletica and PHILIP.
Diversification Opportunities for Lululemon Athletica and PHILIP
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Lululemon and PHILIP is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Lululemon Athletica and PHILIP MORRIS INTERNATIONAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PHILIP MORRIS INTERN 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 PHILIP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PHILIP MORRIS INTERN has no effect on the direction of Lululemon Athletica i.e., Lululemon Athletica and PHILIP go up and down completely randomly.
Pair Corralation between Lululemon Athletica and PHILIP
Given the investment horizon of 90 days Lululemon Athletica is expected to generate 3.83 times more return on investment than PHILIP. However, Lululemon Athletica is 3.83 times more volatile than PHILIP MORRIS INTERNATIONAL. It trades about 0.04 of its potential returns per unit of risk. PHILIP MORRIS INTERNATIONAL is currently generating about 0.02 per unit of risk. If you would invest 30,290 in Lululemon Athletica on August 28, 2024 and sell it today you would earn a total of 2,382 from holding Lululemon Athletica or generate 7.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 97.62% |
| Values | Daily Returns |
Lululemon Athletica vs. PHILIP MORRIS INTERNATIONAL
Performance |
| Timeline |
| Lululemon Athletica |
| PHILIP MORRIS INTERN |
Lululemon Athletica and PHILIP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lululemon Athletica and PHILIP
The main advantage of trading using opposite Lululemon Athletica and PHILIP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lululemon Athletica position performs unexpectedly, PHILIP 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 PHILIP will offset losses from the drop in PHILIP's long position.| Lululemon Athletica vs. VF Corporation | Lululemon Athletica vs. Levi Strauss Co | Lululemon Athletica vs. Under Armour A | Lululemon Athletica vs. Oxford Industries |
| PHILIP vs. Victorias Secret Co | PHILIP vs. Citi Trends | PHILIP vs. Steven Madden | PHILIP vs. Lululemon Athletica |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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