Correlation Between Lumia and V2 Retail
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By analyzing existing cross correlation between Lumia and V2 Retail Limited, you can compare the effects of market volatilities on Lumia and V2 Retail 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 V2 Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lumia and V2 Retail.
Diversification Opportunities for Lumia and V2 Retail
Poor diversification
The 3 months correlation between Lumia and V2RETAIL is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Lumia and V2 Retail Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on V2 Retail Limited 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 V2 Retail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of V2 Retail Limited has no effect on the direction of Lumia i.e., Lumia and V2 Retail go up and down completely randomly.
Pair Corralation between Lumia and V2 Retail
Assuming the 90 days trading horizon Lumia is expected to under-perform the V2 Retail. In addition to that, Lumia is 2.9 times more volatile than V2 Retail Limited. It trades about -0.14 of its total potential returns per unit of risk. V2 Retail Limited is currently generating about 0.31 per unit of volatility. If you would invest 162,160 in V2 Retail Limited on October 20, 2024 and sell it today you would earn a total of 26,940 from holding V2 Retail Limited or generate 16.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Lumia vs. V2 Retail Limited
Performance |
| Timeline |
| Lumia |
| V2 Retail Limited |
Lumia and V2 Retail Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lumia and V2 Retail
The main advantage of trading using opposite Lumia and V2 Retail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lumia position performs unexpectedly, V2 Retail 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 V2 Retail will offset losses from the drop in V2 Retail's long position.The idea behind Lumia and V2 Retail Limited 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.| V2 Retail vs. Ortel Communications Limited | V2 Retail vs. Bodhi Tree Multimedia | V2 Retail vs. Tata Communications Limited | V2 Retail vs. Zee Entertainment Enterprises |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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