Correlation Between LOWES and Edgewell Personal
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By analyzing existing cross correlation between LOWES PANIES INC and Edgewell Personal Care, you can compare the effects of market volatilities on LOWES and Edgewell Personal 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 Edgewell Personal. Check out your portfolio center. Please also check ongoing floating volatility patterns of LOWES and Edgewell Personal.
Diversification Opportunities for LOWES and Edgewell Personal
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between LOWES and Edgewell is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding LOWES PANIES INC and Edgewell Personal Care in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Edgewell Personal Care 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 PANIES INC are associated (or correlated) with Edgewell Personal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Edgewell Personal Care has no effect on the direction of LOWES i.e., LOWES and Edgewell Personal go up and down completely randomly.
Pair Corralation between LOWES and Edgewell Personal
Assuming the 90 days trading horizon LOWES PANIES INC is expected to generate 0.16 times more return on investment than Edgewell Personal. However, LOWES PANIES INC is 6.09 times less risky than Edgewell Personal. It trades about -0.03 of its potential returns per unit of risk. Edgewell Personal Care is currently generating about -0.04 per unit of risk. If you would invest 9,890 in LOWES PANIES INC on September 12, 2024 and sell it today you would lose (76.00) from holding LOWES PANIES INC or give up 0.77% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.4% |
| Values | Daily Returns |
LOWES PANIES INC vs. Edgewell Personal Care
Performance |
| Timeline |
| LOWES PANIES INC |
| Edgewell Personal Care |
LOWES and Edgewell Personal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LOWES and Edgewell Personal
The main advantage of trading using opposite LOWES and Edgewell Personal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LOWES position performs unexpectedly, Edgewell Personal 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 Edgewell Personal will offset losses from the drop in Edgewell Personal's long position.The idea behind LOWES PANIES INC and Edgewell Personal Care pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Edgewell Personal vs. Mannatech Incorporated | Edgewell Personal vs. Inter Parfums | Edgewell Personal vs. Nu Skin Enterprises | Edgewell Personal vs. Helen of Troy |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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