Correlation Between Micron Technology and LUMI GRUPPEN
Can any of the company-specific risk be diversified away by investing in both Micron Technology and LUMI GRUPPEN 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 Micron Technology and LUMI GRUPPEN into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Micron Technology and LUMI GRUPPEN AS, you can compare the effects of market volatilities on Micron Technology and LUMI GRUPPEN 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 Micron Technology with a short position of LUMI GRUPPEN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Micron Technology and LUMI GRUPPEN.
Diversification Opportunities for Micron Technology and LUMI GRUPPEN
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Micron and LUMI is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Micron Technology and LUMI GRUPPEN AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LUMI GRUPPEN AS and Micron 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 Micron Technology are associated (or correlated) with LUMI GRUPPEN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LUMI GRUPPEN AS has no effect on the direction of Micron Technology i.e., Micron Technology and LUMI GRUPPEN go up and down completely randomly.
Pair Corralation between Micron Technology and LUMI GRUPPEN
Allowing for the 90-day total investment horizon Micron Technology is expected to under-perform the LUMI GRUPPEN. But the stock apears to be less risky and, when comparing its historical volatility, Micron Technology is 1.91 times less risky than LUMI GRUPPEN. The stock trades about -0.06 of its potential returns per unit of risk. The LUMI GRUPPEN AS is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 83.00 in LUMI GRUPPEN AS on October 13, 2024 and sell it today you would earn a total of 28.00 from holding LUMI GRUPPEN AS or generate 33.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 98.62% |
| Values | Daily Returns |
Micron Technology vs. LUMI GRUPPEN AS
Performance |
| Timeline |
| Micron Technology |
| LUMI GRUPPEN AS |
Micron Technology and LUMI GRUPPEN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Micron Technology and LUMI GRUPPEN
The main advantage of trading using opposite Micron Technology and LUMI GRUPPEN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Micron Technology position performs unexpectedly, LUMI GRUPPEN 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 LUMI GRUPPEN will offset losses from the drop in LUMI GRUPPEN's long position.| Micron Technology vs. NVIDIA | Micron Technology vs. Intel | Micron Technology vs. Taiwan Semiconductor Manufacturing | Micron Technology vs. Marvell Technology Group |
| LUMI GRUPPEN vs. TT Electronics PLC | LUMI GRUPPEN vs. Penta Ocean Construction Co | LUMI GRUPPEN vs. Meiko Electronics Co | LUMI GRUPPEN vs. Daito Trust Construction |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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