Correlation Between Lithia Motors and Deltagen

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Lithia Motors and Deltagen 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 Lithia Motors and Deltagen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lithia Motors and Deltagen, you can compare the effects of market volatilities on Lithia Motors and Deltagen 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 Lithia Motors with a short position of Deltagen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lithia Motors and Deltagen.

Diversification Opportunities for Lithia Motors and Deltagen

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Lithia and Deltagen is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Lithia Motors and Deltagen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Deltagen and Lithia Motors 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 Lithia Motors are associated (or correlated) with Deltagen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Deltagen has no effect on the direction of Lithia Motors i.e., Lithia Motors and Deltagen go up and down completely randomly.

Pair Corralation between Lithia Motors and Deltagen

If you would invest  0.01  in Deltagen on October 25, 2024 and sell it today you would earn a total of  0.00  from holding Deltagen or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy94.74%
ValuesDaily Returns

Lithia Motors  vs.  Deltagen

 Performance 
       Timeline  
Lithia Motors 

Risk-Adjusted Performance

4 of 100

 
Weak
 
Strong
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in Lithia Motors are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Lithia Motors is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.
Deltagen 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Deltagen has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy technical and fundamental indicators, Deltagen is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Lithia Motors and Deltagen Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Lithia Motors and Deltagen

The main advantage of trading using opposite Lithia Motors and Deltagen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lithia Motors position performs unexpectedly, Deltagen 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 Deltagen will offset losses from the drop in Deltagen's long position.
The idea behind Lithia Motors and Deltagen 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.
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.

Other Complementary Tools

Bonds Directory
Find actively traded corporate debentures issued by US companies
Money Managers
Screen money managers from public funds and ETFs managed around the world
Portfolio Manager
State of the art Portfolio Manager to monitor and improve performance of your invested capital
Content Syndication
Quickly integrate customizable finance content to your own investment portal
Aroon Oscillator
Analyze current equity momentum using Aroon Oscillator and other momentum ratios