Correlation Between 06051GGA1 and Luxfer Holdings
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By analyzing existing cross correlation between BANK AMER P and Luxfer Holdings PLC, you can compare the effects of market volatilities on 06051GGA1 and Luxfer Holdings 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 06051GGA1 with a short position of Luxfer Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of 06051GGA1 and Luxfer Holdings.
Diversification Opportunities for 06051GGA1 and Luxfer Holdings
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between 06051GGA1 and Luxfer is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding BANK AMER P and Luxfer Holdings PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Luxfer Holdings PLC and 06051GGA1 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 BANK AMER P are associated (or correlated) with Luxfer Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Luxfer Holdings PLC has no effect on the direction of 06051GGA1 i.e., 06051GGA1 and Luxfer Holdings go up and down completely randomly.
Pair Corralation between 06051GGA1 and Luxfer Holdings
Assuming the 90 days trading horizon BANK AMER P is expected to under-perform the Luxfer Holdings. But the bond apears to be less risky and, when comparing its historical volatility, BANK AMER P is 6.24 times less risky than Luxfer Holdings. The bond trades about -0.14 of its potential returns per unit of risk. The Luxfer Holdings PLC is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 1,085 in Luxfer Holdings PLC on September 5, 2024 and sell it today you would earn a total of 359.00 from holding Luxfer Holdings PLC or generate 33.09% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 95.31% |
Values | Daily Returns |
BANK AMER P vs. Luxfer Holdings PLC
Performance |
Timeline |
BANK AMER P |
Luxfer Holdings PLC |
06051GGA1 and Luxfer Holdings Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with 06051GGA1 and Luxfer Holdings
The main advantage of trading using opposite 06051GGA1 and Luxfer Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 06051GGA1 position performs unexpectedly, Luxfer Holdings 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 Luxfer Holdings will offset losses from the drop in Luxfer Holdings' long position.06051GGA1 vs. Luxfer Holdings PLC | 06051GGA1 vs. Shake Shack | 06051GGA1 vs. Summit Hotel Properties | 06051GGA1 vs. Air Products and |
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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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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