Correlation Between Vuzix Corp and LG Display
Can any of the company-specific risk be diversified away by investing in both Vuzix Corp and LG Display 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 Vuzix Corp and LG Display into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vuzix Corp Cmn and LG Display Co, you can compare the effects of market volatilities on Vuzix Corp and LG Display 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 Vuzix Corp with a short position of LG Display. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vuzix Corp and LG Display.
Diversification Opportunities for Vuzix Corp and LG Display
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Vuzix and LPL is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Vuzix Corp Cmn and LG Display Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LG Display and Vuzix Corp 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 Vuzix Corp Cmn are associated (or correlated) with LG Display. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LG Display has no effect on the direction of Vuzix Corp i.e., Vuzix Corp and LG Display go up and down completely randomly.
Pair Corralation between Vuzix Corp and LG Display
Given the investment horizon of 90 days Vuzix Corp Cmn is expected to generate 6.17 times more return on investment than LG Display. However, Vuzix Corp is 6.17 times more volatile than LG Display Co. It trades about 0.17 of its potential returns per unit of risk. LG Display Co is currently generating about -0.19 per unit of risk. If you would invest 130.00 in Vuzix Corp Cmn on August 27, 2024 and sell it today you would earn a total of 41.00 from holding Vuzix Corp Cmn or generate 31.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vuzix Corp Cmn vs. LG Display Co
Performance |
| Timeline |
| Vuzix Corp Cmn |
| LG Display |
Vuzix Corp and LG Display Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vuzix Corp and LG Display
The main advantage of trading using opposite Vuzix Corp and LG Display positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vuzix Corp position performs unexpectedly, LG Display 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 LG Display will offset losses from the drop in LG Display's long position.| Vuzix Corp vs. VOXX International | Vuzix Corp vs. LG Display Co | Vuzix Corp vs. Vizio Holding Corp | Vuzix Corp vs. Wearable Devices |
| LG Display vs. VOXX International | LG Display vs. Vizio Holding Corp | LG Display vs. Turtle Beach Corp | LG Display vs. Emerson Radio |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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