Correlation Between Marvell Technology and Lavras Gold
Can any of the company-specific risk be diversified away by investing in both Marvell Technology and Lavras Gold 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 Marvell Technology and Lavras Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marvell Technology Group and Lavras Gold Corp, you can compare the effects of market volatilities on Marvell Technology and Lavras Gold 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 Marvell Technology with a short position of Lavras Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marvell Technology and Lavras Gold.
Diversification Opportunities for Marvell Technology and Lavras Gold
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Marvell and Lavras is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Marvell Technology Group and Lavras Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lavras Gold Corp and Marvell Technology 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 Marvell Technology Group are associated (or correlated) with Lavras Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lavras Gold Corp has no effect on the direction of Marvell Technology i.e., Marvell Technology and Lavras Gold go up and down completely randomly.
Pair Corralation between Marvell Technology and Lavras Gold
Given the investment horizon of 90 days Marvell Technology Group is expected to generate 0.52 times more return on investment than Lavras Gold. However, Marvell Technology Group is 1.93 times less risky than Lavras Gold. It trades about 0.3 of its potential returns per unit of risk. Lavras Gold Corp is currently generating about -0.08 per unit of risk. If you would invest 8,011 in Marvell Technology Group on September 1, 2024 and sell it today you would earn a total of 1,258 from holding Marvell Technology Group or generate 15.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Marvell Technology Group vs. Lavras Gold Corp
Performance |
| Timeline |
| Marvell Technology |
| Lavras Gold Corp |
Marvell Technology and Lavras Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Marvell Technology and Lavras Gold
The main advantage of trading using opposite Marvell Technology and Lavras Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marvell Technology position performs unexpectedly, Lavras Gold 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 Lavras Gold will offset losses from the drop in Lavras Gold's long position.| Marvell Technology vs. NVIDIA | Marvell Technology vs. Intel | Marvell Technology vs. Taiwan Semiconductor Manufacturing | Marvell Technology vs. Micron Technology |
| Lavras Gold vs. Aurion Resources | Lavras Gold vs. Rio2 Limited | Lavras Gold vs. Palamina Corp | Lavras Gold vs. BTU Metals Corp |
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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