Correlation Between JonDeTech Sensors and Lohilo Foods
Can any of the company-specific risk be diversified away by investing in both JonDeTech Sensors and Lohilo Foods 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 JonDeTech Sensors and Lohilo Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JonDeTech Sensors and Lohilo Foods AB, you can compare the effects of market volatilities on JonDeTech Sensors and Lohilo Foods 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 JonDeTech Sensors with a short position of Lohilo Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of JonDeTech Sensors and Lohilo Foods.
Diversification Opportunities for JonDeTech Sensors and Lohilo Foods
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between JonDeTech and Lohilo is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding JonDeTech Sensors and Lohilo Foods AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lohilo Foods AB and JonDeTech Sensors 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 JonDeTech Sensors are associated (or correlated) with Lohilo Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lohilo Foods AB has no effect on the direction of JonDeTech Sensors i.e., JonDeTech Sensors and Lohilo Foods go up and down completely randomly.
Pair Corralation between JonDeTech Sensors and Lohilo Foods
Assuming the 90 days trading horizon JonDeTech Sensors is expected to under-perform the Lohilo Foods. In addition to that, JonDeTech Sensors is 1.45 times more volatile than Lohilo Foods AB. It trades about -0.09 of its total potential returns per unit of risk. Lohilo Foods AB is currently generating about -0.12 per unit of volatility. If you would invest 200.00 in Lohilo Foods AB on September 6, 2024 and sell it today you would lose (67.00) from holding Lohilo Foods AB or give up 33.5% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 98.46% |
Values | Daily Returns |
JonDeTech Sensors vs. Lohilo Foods AB
Performance |
Timeline |
JonDeTech Sensors |
Lohilo Foods AB |
JonDeTech Sensors and Lohilo Foods Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with JonDeTech Sensors and Lohilo Foods
The main advantage of trading using opposite JonDeTech Sensors and Lohilo Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JonDeTech Sensors position performs unexpectedly, Lohilo Foods 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 Lohilo Foods will offset losses from the drop in Lohilo Foods' long position.JonDeTech Sensors vs. Ranplan Group | JonDeTech Sensors vs. Divio Technologies AB | JonDeTech Sensors vs. XMReality AB |
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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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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