Correlation Between Lumia and ASSET BANK

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

By analyzing existing cross correlation between Lumia and ASSET BANK AGRONEGCIOS, you can compare the effects of market volatilities on Lumia and ASSET BANK 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 Lumia with a short position of ASSET BANK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lumia and ASSET BANK.

Diversification Opportunities for Lumia and ASSET BANK

-0.12

Correlation Coefficient

Lumia  ASSET BANK

Good diversification

The 3 months correlation between Lumia and ASSET is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Lumia and ASSET BANK AGRONEGCIOS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASSET BANK AGRONEGCIOS and Lumia 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 Lumia are associated (or correlated) with ASSET BANK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ASSET BANK AGRONEGCIOS has no effect on the direction of Lumia i.e., Lumia and ASSET BANK go up and down completely randomly.

Pair Corralation between Lumia and ASSET BANK

Assuming the 90 days trading horizon Lumia is expected to under-perform the ASSET BANK. But the crypto coin apears to be less risky and, when comparing its historical volatility, Lumia is 1.32 times less risky than ASSET BANK. The crypto coin trades about -0.32 of its potential returns per unit of risk. The ASSET BANK AGRONEGCIOS is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  9,699  in ASSET BANK AGRONEGCIOS on October 25, 2024 and sell it today you would earn a total of  1.00  from holding ASSET BANK AGRONEGCIOS or generate 0.01% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	85.71%
Values	Daily Returns

Lumia  vs.  ASSET BANK AGRONEGCIOS

Lumia

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Lumia are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental indicators, Lumia exhibited solid returns over the last few months and may actually be approaching a breakup point.

ASSET BANK AGRONEGCIOS

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in ASSET BANK AGRONEGCIOS are ranked lower than 1 (%) of all funds and portfolios of funds over the last 90 days. Despite somewhat weak technical and fundamental indicators, ASSET BANK may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Lumia and ASSET BANK

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

The idea behind Lumia and ASSET BANK AGRONEGCIOS 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.