Correlation Between 871911AT0 and Luxfer Holdings
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By analyzing existing cross correlation between US871911AT09 and Luxfer Holdings PLC, you can compare the effects of market volatilities on 871911AT0 and Luxfer Holdings 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 871911AT0 with a short position of Luxfer Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of 871911AT0 and Luxfer Holdings.
Diversification Opportunities for 871911AT0 and Luxfer Holdings
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between 871911AT0 and Luxfer is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding US871911AT09 and Luxfer Holdings PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Luxfer Holdings PLC and 871911AT0 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 US871911AT09 are associated (or correlated) with Luxfer Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Luxfer Holdings PLC has no effect on the direction of 871911AT0 i.e., 871911AT0 and Luxfer Holdings go up and down completely randomly.
Pair Corralation between 871911AT0 and Luxfer Holdings
Assuming the 90 days trading horizon 871911AT0 is expected to generate 8.28 times less return on investment than Luxfer Holdings. But when comparing it to its historical volatility, US871911AT09 is 4.72 times less risky than Luxfer Holdings. It trades about 0.04 of its potential returns per unit of risk. Luxfer Holdings PLC is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 871.00 in Luxfer Holdings PLC on September 14, 2024 and sell it today you would earn a total of 485.00 from holding Luxfer Holdings PLC or generate 55.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 48.59% |
| Values | Daily Returns |
US871911AT09 vs. Luxfer Holdings PLC
Performance |
| Timeline |
| US871911AT09 |
| Luxfer Holdings PLC |
871911AT0 and Luxfer Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 871911AT0 and Luxfer Holdings
The main advantage of trading using opposite 871911AT0 and Luxfer Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 871911AT0 position performs unexpectedly, Luxfer Holdings 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 Luxfer Holdings will offset losses from the drop in Luxfer Holdings' long position.| 871911AT0 vs. Luxfer Holdings PLC | 871911AT0 vs. 51Talk Online Education | 871911AT0 vs. CF Industries Holdings | 871911AT0 vs. Avient Corp |
| Luxfer Holdings vs. Graham | Luxfer Holdings vs. Enerpac Tool Group | Luxfer Holdings vs. Kadant Inc | Luxfer Holdings vs. Omega Flex |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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