Correlation Between LOWES and Transocean
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By analyzing existing cross correlation between LOWES INC 665 and Transocean, you can compare the effects of market volatilities on LOWES and Transocean 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 LOWES with a short position of Transocean. Check out your portfolio center. Please also check ongoing floating volatility patterns of LOWES and Transocean.
Diversification Opportunities for LOWES and Transocean
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between LOWES and Transocean is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding LOWES INC 665 and Transocean in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Transocean and LOWES 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 LOWES INC 665 are associated (or correlated) with Transocean. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Transocean has no effect on the direction of LOWES i.e., LOWES and Transocean go up and down completely randomly.
Pair Corralation between LOWES and Transocean
Assuming the 90 days trading horizon LOWES INC 665 is expected to generate 0.78 times more return on investment than Transocean. However, LOWES INC 665 is 1.28 times less risky than Transocean. It trades about -0.01 of its potential returns per unit of risk. Transocean is currently generating about -0.14 per unit of risk. If you would invest 11,131 in LOWES INC 665 on September 12, 2024 and sell it today you would lose (105.00) from holding LOWES INC 665 or give up 0.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 81.82% |
| Values | Daily Returns |
LOWES INC 665 vs. Transocean
Performance |
| Timeline |
| LOWES INC 665 |
| Transocean |
LOWES and Transocean Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LOWES and Transocean
The main advantage of trading using opposite LOWES and Transocean positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LOWES position performs unexpectedly, Transocean 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 Transocean will offset losses from the drop in Transocean's long position.| LOWES vs. AEP TEX INC | LOWES vs. US BANK NATIONAL | LOWES vs. Applied Blockchain | LOWES vs. BigBearai Holdings |
| Transocean vs. Valneva SE ADR | Transocean vs. Summit Hotel Properties | Transocean vs. Freedom Holding Corp | Transocean vs. Uber Technologies |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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