Correlation Between XLMedia PLC and Light Science
Can any of the company-specific risk be diversified away by investing in both XLMedia PLC and Light Science 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 XLMedia PLC and Light Science into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between XLMedia PLC and Light Science Technologies, you can compare the effects of market volatilities on XLMedia PLC and Light Science 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 XLMedia PLC with a short position of Light Science. Check out your portfolio center. Please also check ongoing floating volatility patterns of XLMedia PLC and Light Science.
Diversification Opportunities for XLMedia PLC and Light Science
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between XLMedia and Light is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding XLMedia PLC and Light Science Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Light Science Techno and XLMedia PLC 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 XLMedia PLC are associated (or correlated) with Light Science. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Light Science Techno has no effect on the direction of XLMedia PLC i.e., XLMedia PLC and Light Science go up and down completely randomly.
Pair Corralation between XLMedia PLC and Light Science
Assuming the 90 days trading horizon XLMedia PLC is expected to under-perform the Light Science. In addition to that, XLMedia PLC is 1.1 times more volatile than Light Science Technologies. It trades about -0.05 of its total potential returns per unit of risk. Light Science Technologies is currently generating about 0.03 per unit of volatility. If you would invest 230.00 in Light Science Technologies on October 30, 2024 and sell it today you would earn a total of 5.00 from holding Light Science Technologies or generate 2.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
XLMedia PLC vs. Light Science Technologies
Performance |
| Timeline |
| XLMedia PLC |
| Light Science Techno |
XLMedia PLC and Light Science Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with XLMedia PLC and Light Science
The main advantage of trading using opposite XLMedia PLC and Light Science positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if XLMedia PLC position performs unexpectedly, Light Science 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 Light Science will offset losses from the drop in Light Science's long position.| XLMedia PLC vs. Livermore Investments Group | XLMedia PLC vs. Mobius Investment Trust | XLMedia PLC vs. Lindsell Train Investment | XLMedia PLC vs. FC Investment Trust |
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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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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