Correlation Between Lumia and Guardian Logistica
Can any of the company-specific risk be diversified away by investing in both Lumia and Guardian Logistica 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 Guardian Logistica into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lumia and Guardian Logistica Fundo, you can compare the effects of market volatilities on Lumia and Guardian Logistica 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 Guardian Logistica. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lumia and Guardian Logistica.
Diversification Opportunities for Lumia and Guardian Logistica
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Lumia and Guardian is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Lumia and Guardian Logistica Fundo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guardian Logistica Fundo 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 Guardian Logistica. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guardian Logistica Fundo has no effect on the direction of Lumia i.e., Lumia and Guardian Logistica go up and down completely randomly.
Pair Corralation between Lumia and Guardian Logistica
Assuming the 90 days trading horizon Lumia is expected to generate 94.67 times more return on investment than Guardian Logistica. However, Lumia is 94.67 times more volatile than Guardian Logistica Fundo. It trades about 0.04 of its potential returns per unit of risk. Guardian Logistica Fundo is currently generating about 0.06 per unit of risk. If you would invest 0.00 in Lumia on November 2, 2024 and sell it today you would earn a total of 91.00 from holding Lumia or generate 9.223372036854776E16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 96.3% |
| Values | Daily Returns |
Lumia vs. Guardian Logistica Fundo
Performance |
| Timeline |
| Lumia |
| Guardian Logistica Fundo |
Lumia and Guardian Logistica Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lumia and Guardian Logistica
The main advantage of trading using opposite Lumia and Guardian Logistica positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lumia position performs unexpectedly, Guardian Logistica 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 Guardian Logistica will offset losses from the drop in Guardian Logistica's long position.The idea behind Lumia and Guardian Logistica Fundo 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.| Guardian Logistica vs. Alianza Trust Renda | Guardian Logistica vs. XP Selection Fundo | Guardian Logistica vs. HEDGE DESENVOLVIMENTO LOGSTICO | Guardian Logistica vs. Caixa Rio Bravo |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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