Correlation Between AOI Electronics and Lowes Companies
Can any of the company-specific risk be diversified away by investing in both AOI Electronics and Lowes Companies 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 AOI Electronics and Lowes Companies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AOI Electronics Co and Lowes Companies, you can compare the effects of market volatilities on AOI Electronics and Lowes Companies 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 AOI Electronics with a short position of Lowes Companies. Check out your portfolio center. Please also check ongoing floating volatility patterns of AOI Electronics and Lowes Companies.
Diversification Opportunities for AOI Electronics and Lowes Companies
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between AOI and Lowes is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding AOI Electronics Co and Lowes Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lowes Companies and AOI Electronics 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 AOI Electronics Co are associated (or correlated) with Lowes Companies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lowes Companies has no effect on the direction of AOI Electronics i.e., AOI Electronics and Lowes Companies go up and down completely randomly.
Pair Corralation between AOI Electronics and Lowes Companies
If you would invest 24,200 in Lowes Companies on September 5, 2024 and sell it today you would earn a total of 1,620 from holding Lowes Companies or generate 6.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AOI Electronics Co vs. Lowes Companies
Performance |
| Timeline |
| AOI Electronics |
| Lowes Companies |
AOI Electronics and Lowes Companies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AOI Electronics and Lowes Companies
The main advantage of trading using opposite AOI Electronics and Lowes Companies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AOI Electronics position performs unexpectedly, Lowes Companies 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 Lowes Companies will offset losses from the drop in Lowes Companies' long position.| AOI Electronics vs. Pure Storage | AOI Electronics vs. Cardinal Health | AOI Electronics vs. DICKER DATA LTD | AOI Electronics vs. National Health Investors |
| Lowes Companies vs. AOI Electronics Co | Lowes Companies vs. Liberty Broadband | Lowes Companies vs. STORE ELECTRONIC | Lowes Companies vs. Gaztransport Technigaz SA |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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