Correlation Between Ionet and LXP Industrial
Can any of the company-specific risk be diversified away by investing in both Ionet and LXP Industrial 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 Ionet and LXP Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ionet and LXP Industrial Trust, you can compare the effects of market volatilities on Ionet and LXP Industrial 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 Ionet with a short position of LXP Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ionet and LXP Industrial.
Diversification Opportunities for Ionet and LXP Industrial
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Ionet and LXP is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding ionet and LXP Industrial Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LXP Industrial Trust and Ionet 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 ionet are associated (or correlated) with LXP Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LXP Industrial Trust has no effect on the direction of Ionet i.e., Ionet and LXP Industrial go up and down completely randomly.
Pair Corralation between Ionet and LXP Industrial
Assuming the 90 days horizon ionet is expected to generate 4.72 times more return on investment than LXP Industrial. However, Ionet is 4.72 times more volatile than LXP Industrial Trust. It trades about 0.02 of its potential returns per unit of risk. LXP Industrial Trust is currently generating about 0.01 per unit of risk. If you would invest 176.00 in ionet on December 1, 2024 and sell it today you would lose (54.00) from holding ionet or give up 30.68% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 96.3% |
Values | Daily Returns |
ionet vs. LXP Industrial Trust
Performance |
Timeline |
ionet |
LXP Industrial Trust |
Ionet and LXP Industrial Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Ionet and LXP Industrial
The main advantage of trading using opposite Ionet and LXP Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ionet position performs unexpectedly, LXP Industrial 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 LXP Industrial will offset losses from the drop in LXP Industrial's long position.The idea behind ionet and LXP Industrial Trust 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.LXP Industrial vs. First Industrial Realty | LXP Industrial vs. Plymouth Industrial REIT | LXP Industrial vs. Global Self Storage | LXP Industrial vs. Terreno Realty |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
Other Complementary Tools
Bonds Directory Find actively traded corporate debentures issued by US companies | |
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 | |
Global Correlations Find global opportunities by holding instruments from different markets | |
Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets |