Correlation Between Graham Holdings and LUMI GRUPPEN
Can any of the company-specific risk be diversified away by investing in both Graham Holdings and LUMI GRUPPEN 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 Graham Holdings and LUMI GRUPPEN into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Graham Holdings Co and LUMI GRUPPEN AS, you can compare the effects of market volatilities on Graham Holdings and LUMI GRUPPEN 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 Graham Holdings with a short position of LUMI GRUPPEN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Graham Holdings and LUMI GRUPPEN.
Diversification Opportunities for Graham Holdings and LUMI GRUPPEN
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Graham and LUMI is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Graham Holdings Co and LUMI GRUPPEN AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LUMI GRUPPEN AS and Graham Holdings 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 Graham Holdings Co are associated (or correlated) with LUMI GRUPPEN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LUMI GRUPPEN AS has no effect on the direction of Graham Holdings i.e., Graham Holdings and LUMI GRUPPEN go up and down completely randomly.
Pair Corralation between Graham Holdings and LUMI GRUPPEN
Assuming the 90 days trading horizon Graham Holdings Co is expected to under-perform the LUMI GRUPPEN. But the stock apears to be less risky and, when comparing its historical volatility, Graham Holdings Co is 3.87 times less risky than LUMI GRUPPEN. The stock trades about -0.17 of its potential returns per unit of risk. The LUMI GRUPPEN AS is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 85.00 in LUMI GRUPPEN AS on September 24, 2024 and sell it today you would earn a total of 13.00 from holding LUMI GRUPPEN AS or generate 15.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Graham Holdings Co vs. LUMI GRUPPEN AS
Performance |
| Timeline |
| Graham Holdings |
| LUMI GRUPPEN AS |
Graham Holdings and LUMI GRUPPEN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Graham Holdings and LUMI GRUPPEN
The main advantage of trading using opposite Graham Holdings and LUMI GRUPPEN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Graham Holdings position performs unexpectedly, LUMI GRUPPEN 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 LUMI GRUPPEN will offset losses from the drop in LUMI GRUPPEN's long position.| Graham Holdings vs. IDP EDUCATION LTD | Graham Holdings vs. TAL Education Group | Graham Holdings vs. Grand Canyon Education | Graham Holdings vs. Strategic Education |
| LUMI GRUPPEN vs. LG Display Co | LUMI GRUPPEN vs. CHEMICAL INDUSTRIES | LUMI GRUPPEN vs. NISSAN CHEMICAL IND | LUMI GRUPPEN vs. Nissan Chemical Corp |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
Other Complementary Tools
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. |