Correlation Between Lighting Science and NeoVolta Common

Can any of the company-specific risk be diversified away by investing in both Lighting Science and NeoVolta Common 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 Lighting Science and NeoVolta Common into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Lighting Science Group and NeoVolta Common Stock, you can compare the effects of market volatilities on Lighting Science and NeoVolta Common 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 Lighting Science with a short position of NeoVolta Common. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lighting Science and NeoVolta Common.

Diversification Opportunities for Lighting Science and NeoVolta Common

0.0

Correlation Coefficient

Lighting Science  NeoVolta Common

Pay attention - limited upside

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

Pair Corralation between Lighting Science and NeoVolta Common

If you would invest (100.00) in Lighting Science Group on November 28, 2024 and sell it today you would earn a total of  100.00  from holding Lighting Science Group or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Lighting Science Group  vs.  NeoVolta Common Stock

Lighting Science

Risk-Adjusted Performance

Very Weak

Over the last 90 days Lighting Science Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable fundamental indicators, Lighting Science is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

NeoVolta Common Stock

Risk-Adjusted Performance

Very Weak

Over the last 90 days NeoVolta Common Stock has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in March 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with Lighting Science and NeoVolta Common

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

The idea behind Lighting Science Group and NeoVolta Common Stock 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.