Correlation Between 82967NBL1 and Lululemon Athletica
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By analyzing existing cross correlation between US82967NBL10 and Lululemon Athletica, you can compare the effects of market volatilities on 82967NBL1 and Lululemon Athletica 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 82967NBL1 with a short position of Lululemon Athletica. Check out your portfolio center. Please also check ongoing floating volatility patterns of 82967NBL1 and Lululemon Athletica.
Diversification Opportunities for 82967NBL1 and Lululemon Athletica
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between 82967NBL1 and Lululemon is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding US82967NBL10 and Lululemon Athletica in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lululemon Athletica and 82967NBL1 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 US82967NBL10 are associated (or correlated) with Lululemon Athletica. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lululemon Athletica has no effect on the direction of 82967NBL1 i.e., 82967NBL1 and Lululemon Athletica go up and down completely randomly.
Pair Corralation between 82967NBL1 and Lululemon Athletica
Assuming the 90 days trading horizon 82967NBL1 is expected to generate 4.73 times less return on investment than Lululemon Athletica. But when comparing it to its historical volatility, US82967NBL10 is 5.58 times less risky than Lululemon Athletica. It trades about 0.03 of its potential returns per unit of risk. Lululemon Athletica is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 32,338 in Lululemon Athletica on September 24, 2024 and sell it today you would earn a total of 5,766 from holding Lululemon Athletica or generate 17.83% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 97.39% |
Values | Daily Returns |
US82967NBL10 vs. Lululemon Athletica
Performance |
Timeline |
US82967NBL10 |
Lululemon Athletica |
82967NBL1 and Lululemon Athletica Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with 82967NBL1 and Lululemon Athletica
The main advantage of trading using opposite 82967NBL1 and Lululemon Athletica positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 82967NBL1 position performs unexpectedly, Lululemon Athletica 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 Lululemon Athletica will offset losses from the drop in Lululemon Athletica's long position.82967NBL1 vs. Nuvalent | 82967NBL1 vs. Lululemon Athletica | 82967NBL1 vs. Grocery Outlet Holding | 82967NBL1 vs. Upper Street Marketing |
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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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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