Correlation Between Latham and Intelligent Living
Can any of the company-specific risk be diversified away by investing in both Latham and Intelligent Living 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 Latham and Intelligent Living into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Latham Group and Intelligent Living Application, you can compare the effects of market volatilities on Latham and Intelligent Living 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 Latham with a short position of Intelligent Living. Check out your portfolio center. Please also check ongoing floating volatility patterns of Latham and Intelligent Living.
Diversification Opportunities for Latham and Intelligent Living
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Latham and Intelligent is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Latham Group and Intelligent Living Application in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intelligent Living and Latham 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 Latham Group are associated (or correlated) with Intelligent Living. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intelligent Living has no effect on the direction of Latham i.e., Latham and Intelligent Living go up and down completely randomly.
Pair Corralation between Latham and Intelligent Living
Given the investment horizon of 90 days Latham Group is expected to generate 0.76 times more return on investment than Intelligent Living. However, Latham Group is 1.31 times less risky than Intelligent Living. It trades about 0.06 of its potential returns per unit of risk. Intelligent Living Application is currently generating about 0.02 per unit of risk. If you would invest 308.00 in Latham Group on August 24, 2024 and sell it today you would earn a total of 381.00 from holding Latham Group or generate 123.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Latham Group vs. Intelligent Living Application
Performance |
| Timeline |
| Latham Group |
| Intelligent Living |
Latham and Intelligent Living Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Latham and Intelligent Living
The main advantage of trading using opposite Latham and Intelligent Living positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Latham position performs unexpectedly, Intelligent Living 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 Intelligent Living will offset losses from the drop in Intelligent Living's long position.| Latham vs. Janus International Group | Latham vs. Quanex Building Products | Latham vs. GMS Inc | Latham vs. Gibraltar Industries |
| Intelligent Living vs. Azek Company | Intelligent Living vs. Atlas Engineered Products | Intelligent Living vs. Antelope Enterprise Holdings | Intelligent Living vs. Latham 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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