Correlation Between Lumia and KTAM SET

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

By analyzing existing cross correlation between Lumia and KTAM SET Food, you can compare the effects of market volatilities on Lumia and KTAM SET 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 KTAM SET. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lumia and KTAM SET.

Diversification Opportunities for Lumia and KTAM SET

0.0

Correlation Coefficient

Lumia  KTAM SET

Pay attention - limited upside

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

Pair Corralation between Lumia and KTAM SET

If you would invest (100.00) in KTAM SET Food on October 27, 2024 and sell it today you would earn a total of  100.00  from holding KTAM SET Food 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

Lumia  vs.  KTAM SET Food

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.

KTAM SET Food

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days KTAM SET Food has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, KTAM SET is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Lumia and KTAM SET

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

The idea behind Lumia and KTAM SET Food 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.