Correlation Between Usio and Luxfer Holdings
Can any of the company-specific risk be diversified away by investing in both Usio and Luxfer Holdings 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 Usio and Luxfer Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Usio Inc and Luxfer Holdings PLC, you can compare the effects of market volatilities on Usio 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 Usio with a short position of Luxfer Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Usio and Luxfer Holdings.
Diversification Opportunities for Usio and Luxfer Holdings
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Usio and Luxfer is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Usio Inc 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 Usio 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 Usio Inc 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 Usio i.e., Usio and Luxfer Holdings go up and down completely randomly.
Pair Corralation between Usio and Luxfer Holdings
Given the investment horizon of 90 days Usio Inc is expected to under-perform the Luxfer Holdings. In addition to that, Usio is 1.26 times more volatile than Luxfer Holdings PLC. It trades about -0.01 of its total potential returns per unit of risk. Luxfer Holdings PLC is currently generating about 0.01 per unit of volatility. If you would invest 1,512 in Luxfer Holdings PLC on September 1, 2024 and sell it today you would lose (76.00) from holding Luxfer Holdings PLC or give up 5.03% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Usio Inc vs. Luxfer Holdings PLC
Performance |
| Timeline |
| Usio Inc |
| Luxfer Holdings PLC |
Usio and Luxfer Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Usio and Luxfer Holdings
The main advantage of trading using opposite Usio and Luxfer Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Usio 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.| Usio vs. Appen Limited | Usio vs. Value Exchange International | Usio vs. Appen Limited | Usio vs. Deveron 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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