Correlation Between Lululemon Athletica and Veea
Can any of the company-specific risk be diversified away by investing in both Lululemon Athletica and Veea 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 Lululemon Athletica and Veea into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lululemon Athletica and Veea Inc, you can compare the effects of market volatilities on Lululemon Athletica and Veea 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 Lululemon Athletica with a short position of Veea. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lululemon Athletica and Veea.
Diversification Opportunities for Lululemon Athletica and Veea
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Lululemon and Veea is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Lululemon Athletica and Veea Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Veea Inc and Lululemon Athletica 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 Lululemon Athletica are associated (or correlated) with Veea. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Veea Inc has no effect on the direction of Lululemon Athletica i.e., Lululemon Athletica and Veea go up and down completely randomly.
Pair Corralation between Lululemon Athletica and Veea
Given the investment horizon of 90 days Lululemon Athletica is expected to generate 0.45 times more return on investment than Veea. However, Lululemon Athletica is 2.23 times less risky than Veea. It trades about 0.06 of its potential returns per unit of risk. Veea Inc is currently generating about -0.06 per unit of risk. If you would invest 34,066 in Lululemon Athletica on December 3, 2024 and sell it today you would earn a total of 2,495 from holding Lululemon Athletica or generate 7.32% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Lululemon Athletica vs. Veea Inc
Performance |
Timeline |
Lululemon Athletica |
Veea Inc |
Lululemon Athletica and Veea Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Lululemon Athletica and Veea
The main advantage of trading using opposite Lululemon Athletica and Veea positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lululemon Athletica position performs unexpectedly, Veea 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 Veea will offset losses from the drop in Veea's long position.Lululemon Athletica vs. American Eagle Outfitters | Lululemon Athletica vs. Abercrombie Fitch | Lululemon Athletica vs. Urban Outfitters | Lululemon Athletica vs. Foot Locker |
Veea vs. Albertsons Companies | Veea vs. KNOT Offshore Partners | Veea vs. SBM Offshore NV | Veea vs. Solstad Offshore ASA |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
Other Complementary Tools
Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments |