Correlation Between Lumia and Anterix
Can any of the company-specific risk be diversified away by investing in both Lumia and Anterix 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 Lumia and Anterix into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lumia and Anterix, you can compare the effects of market volatilities on Lumia and Anterix 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 Lumia with a short position of Anterix. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lumia and Anterix.
Diversification Opportunities for Lumia and Anterix
Excellent diversification
The 3 months correlation between Lumia and Anterix is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Lumia and Anterix in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anterix and Lumia 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 Lumia are associated (or correlated) with Anterix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anterix has no effect on the direction of Lumia i.e., Lumia and Anterix go up and down completely randomly.
Pair Corralation between Lumia and Anterix
Assuming the 90 days trading horizon Lumia is expected to under-perform the Anterix. In addition to that, Lumia is 1.82 times more volatile than Anterix. It trades about -0.19 of its total potential returns per unit of risk. Anterix is currently generating about 0.04 per unit of volatility. If you would invest 3,047 in Anterix on October 20, 2024 and sell it today you would earn a total of 52.00 from holding Anterix or generate 1.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 86.36% |
| Values | Daily Returns |
Lumia vs. Anterix
Performance |
| Timeline |
| Lumia |
| Anterix |
Lumia and Anterix Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lumia and Anterix
The main advantage of trading using opposite Lumia and Anterix positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lumia position performs unexpectedly, Anterix 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 Anterix will offset losses from the drop in Anterix's long position.The idea behind Lumia and Anterix pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Anterix vs. Shenandoah Telecommunications Co | Anterix vs. Liberty Broadband Corp | Anterix vs. Ooma Inc | Anterix vs. IDT Corporation |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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