Correlation Between CHEMICAL INDUSTRIES and LPKF Laser
Can any of the company-specific risk be diversified away by investing in both CHEMICAL INDUSTRIES and LPKF Laser 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 CHEMICAL INDUSTRIES and LPKF Laser into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CHEMICAL INDUSTRIES and LPKF Laser Electronics, you can compare the effects of market volatilities on CHEMICAL INDUSTRIES and LPKF Laser 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 CHEMICAL INDUSTRIES with a short position of LPKF Laser. Check out your portfolio center. Please also check ongoing floating volatility patterns of CHEMICAL INDUSTRIES and LPKF Laser.
Diversification Opportunities for CHEMICAL INDUSTRIES and LPKF Laser
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between CHEMICAL and LPKF is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding CHEMICAL INDUSTRIES and LPKF Laser Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LPKF Laser Electronics and CHEMICAL INDUSTRIES 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 CHEMICAL INDUSTRIES are associated (or correlated) with LPKF Laser. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LPKF Laser Electronics has no effect on the direction of CHEMICAL INDUSTRIES i.e., CHEMICAL INDUSTRIES and LPKF Laser go up and down completely randomly.
Pair Corralation between CHEMICAL INDUSTRIES and LPKF Laser
If you would invest 845.00 in LPKF Laser Electronics on September 24, 2024 and sell it today you would earn a total of 45.00 from holding LPKF Laser Electronics or generate 5.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
CHEMICAL INDUSTRIES vs. LPKF Laser Electronics
Performance |
| Timeline |
| CHEMICAL INDUSTRIES |
| LPKF Laser Electronics |
CHEMICAL INDUSTRIES and LPKF Laser Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CHEMICAL INDUSTRIES and LPKF Laser
The main advantage of trading using opposite CHEMICAL INDUSTRIES and LPKF Laser positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CHEMICAL INDUSTRIES position performs unexpectedly, LPKF Laser 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 LPKF Laser will offset losses from the drop in LPKF Laser's long position.| CHEMICAL INDUSTRIES vs. Apple Inc | CHEMICAL INDUSTRIES vs. Apple Inc | CHEMICAL INDUSTRIES vs. Apple Inc | CHEMICAL INDUSTRIES vs. Apple Inc |
| LPKF Laser vs. CHEMICAL INDUSTRIES | LPKF Laser vs. PTT Global Chemical | LPKF Laser vs. Nissan Chemical Corp | LPKF Laser vs. Soken Chemical Engineering |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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