Correlation Between LB Foster and EQV Ventures

Can any of the company-specific risk be diversified away by investing in both LB Foster and EQV Ventures 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 LB Foster and EQV Ventures into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between LB Foster and EQV Ventures Acquisition, you can compare the effects of market volatilities on LB Foster and EQV Ventures 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 LB Foster with a short position of EQV Ventures. Check out your portfolio center. Please also check ongoing floating volatility patterns of LB Foster and EQV Ventures.

Diversification Opportunities for LB Foster and EQV Ventures

-0.51

Correlation Coefficient

LB Foster  EQV Ventures

Excellent diversification

The 3 months correlation between FSTR and EQV is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding LB Foster and EQV Ventures Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EQV Ventures Acquisition and LB Foster 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 LB Foster are associated (or correlated) with EQV Ventures. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EQV Ventures Acquisition has no effect on the direction of LB Foster i.e., LB Foster and EQV Ventures go up and down completely randomly.

Pair Corralation between LB Foster and EQV Ventures

Given the investment horizon of 90 days LB Foster is expected to under-perform the EQV Ventures. In addition to that, LB Foster is 22.89 times more volatile than EQV Ventures Acquisition. It trades about -0.17 of its total potential returns per unit of risk. EQV Ventures Acquisition is currently generating about 0.13 per unit of volatility. If you would invest  994.00  in EQV Ventures Acquisition on December 17, 2024 and sell it today you would earn a total of  10.00  from holding EQV Ventures Acquisition or generate 1.01% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

LB Foster  vs.  EQV Ventures Acquisition

LB Foster

Risk-Adjusted Performance

Very Weak

Over the last 90 days LB Foster has generated negative risk-adjusted returns adding no value to investors with long positions. Even with unfluctuating performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

EQV Ventures Acquisition

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in EQV Ventures Acquisition are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable basic indicators, EQV Ventures is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with LB Foster and EQV Ventures

The main advantage of trading using opposite LB Foster and EQV Ventures positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LB Foster position performs unexpectedly, EQV Ventures 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 EQV Ventures will offset losses from the drop in EQV Ventures' long position.

The idea behind LB Foster and EQV Ventures Acquisition pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Transaction History module to view history of all your transactions and understand their impact on performance.