Correlation Between Luxfer Holdings and Isonics
Can any of the company-specific risk be diversified away by investing in both Luxfer Holdings and Isonics 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 Luxfer Holdings and Isonics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Luxfer Holdings PLC and Isonics, you can compare the effects of market volatilities on Luxfer Holdings and Isonics 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 Luxfer Holdings with a short position of Isonics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Luxfer Holdings and Isonics.
Diversification Opportunities for Luxfer Holdings and Isonics
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Luxfer and Isonics is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Luxfer Holdings PLC and Isonics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Isonics and Luxfer Holdings 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 Luxfer Holdings PLC are associated (or correlated) with Isonics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Isonics has no effect on the direction of Luxfer Holdings i.e., Luxfer Holdings and Isonics go up and down completely randomly.
Pair Corralation between Luxfer Holdings and Isonics
Given the investment horizon of 90 days Luxfer Holdings is expected to generate 3066.44 times less return on investment than Isonics. But when comparing it to its historical volatility, Luxfer Holdings PLC is 175.58 times less risky than Isonics. It trades about 0.02 of its potential returns per unit of risk. Isonics is currently generating about 0.39 of returns per unit of risk over similar time horizon. If you would invest 0.00 in Isonics on September 14, 2024 and sell it today you would earn a total of 0.00 from holding Isonics or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 1.01% |
| Values | Daily Returns |
Luxfer Holdings PLC vs. Isonics
Performance |
| Timeline |
| Luxfer Holdings PLC |
| Isonics |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Luxfer Holdings and Isonics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Luxfer Holdings and Isonics
The main advantage of trading using opposite Luxfer Holdings and Isonics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Luxfer Holdings position performs unexpectedly, Isonics 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 Isonics will offset losses from the drop in Isonics' long position.| Luxfer Holdings vs. Graham | Luxfer Holdings vs. Enerpac Tool Group | Luxfer Holdings vs. Kadant Inc | Luxfer Holdings vs. Omega Flex |
| Isonics vs. Eastman Chemical | Isonics vs. Luxfer Holdings PLC | Isonics vs. Hudson Technologies | Isonics vs. Freedom Internet Group |
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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