Correlation Between Luxfer Holdings and MICROSOFT
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By analyzing existing cross correlation between Luxfer Holdings PLC and MICROSOFT PORATION, you can compare the effects of market volatilities on Luxfer Holdings and MICROSOFT 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 MICROSOFT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Luxfer Holdings and MICROSOFT.
Diversification Opportunities for Luxfer Holdings and MICROSOFT
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Luxfer and MICROSOFT is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Luxfer Holdings PLC and MICROSOFT PORATION in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MICROSOFT PORATION 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 MICROSOFT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MICROSOFT PORATION has no effect on the direction of Luxfer Holdings i.e., Luxfer Holdings and MICROSOFT go up and down completely randomly.
Pair Corralation between Luxfer Holdings and MICROSOFT
Given the investment horizon of 90 days Luxfer Holdings PLC is expected to under-perform the MICROSOFT. But the stock apears to be less risky and, when comparing its historical volatility, Luxfer Holdings PLC is 1.03 times less risky than MICROSOFT. The stock trades about -0.18 of its potential returns per unit of risk. The MICROSOFT PORATION is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 6,873 in MICROSOFT PORATION on September 13, 2024 and sell it today you would earn a total of 621.00 from holding MICROSOFT PORATION or generate 9.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Luxfer Holdings PLC vs. MICROSOFT PORATION
Performance |
| Timeline |
| Luxfer Holdings PLC |
| MICROSOFT PORATION |
Luxfer Holdings and MICROSOFT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Luxfer Holdings and MICROSOFT
The main advantage of trading using opposite Luxfer Holdings and MICROSOFT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Luxfer Holdings position performs unexpectedly, MICROSOFT 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 MICROSOFT will offset losses from the drop in MICROSOFT's long position.| Luxfer Holdings vs. Graham | Luxfer Holdings vs. Enerpac Tool Group | Luxfer Holdings vs. Kadant Inc | Luxfer Holdings vs. Omega Flex |
| MICROSOFT vs. Lululemon Athletica | MICROSOFT vs. Chewy Inc | MICROSOFT vs. Boyd Gaming | MICROSOFT vs. Asbury Automotive 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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