Correlation Between LOWES and Weyco

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

By analyzing existing cross correlation between LOWES INC 65 and Weyco Group, you can compare the effects of market volatilities on LOWES and Weyco 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 LOWES with a short position of Weyco. Check out your portfolio center. Please also check ongoing floating volatility patterns of LOWES and Weyco.

Diversification Opportunities for LOWES and Weyco

0.11

Correlation Coefficient

LOWES  Weyco

Average diversification

The 3 months correlation between LOWES and Weyco is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding LOWES INC 65 and Weyco Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Weyco Group and LOWES 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 LOWES INC 65 are associated (or correlated) with Weyco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Weyco Group has no effect on the direction of LOWES i.e., LOWES and Weyco go up and down completely randomly.

Pair Corralation between LOWES and Weyco

Assuming the 90 days trading horizon LOWES is expected to generate 11.68 times less return on investment than Weyco. But when comparing it to its historical volatility, LOWES INC 65 is 5.01 times less risky than Weyco. It trades about 0.0 of its potential returns per unit of risk. Weyco Group is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  3,108  in Weyco Group on December 28, 2024 and sell it today you would lose (16.00) from holding Weyco Group or give up 0.51% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	92.91%
Values	Daily Returns

LOWES INC 65  vs.  Weyco Group

LOWES INC 65

Risk-Adjusted Performance

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in LOWES INC 65 are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, LOWES is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Weyco Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days Weyco Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with LOWES and Weyco

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

The idea behind LOWES INC 65 and Weyco Group 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.