Correlation Between Loral Space and Ciena Corp
Can any of the company-specific risk be diversified away by investing in both Loral Space and Ciena Corp 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 Loral Space and Ciena Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Loral Space Communications and Ciena Corp, you can compare the effects of market volatilities on Loral Space and Ciena Corp 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 Loral Space with a short position of Ciena Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Loral Space and Ciena Corp.
Diversification Opportunities for Loral Space and Ciena Corp
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Loral and Ciena is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Loral Space Communications and Ciena Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ciena Corp and Loral Space 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 Loral Space Communications are associated (or correlated) with Ciena Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ciena Corp has no effect on the direction of Loral Space i.e., Loral Space and Ciena Corp go up and down completely randomly.
Pair Corralation between Loral Space and Ciena Corp
If you would invest (100.00) in Loral Space Communications on January 26, 2024 and sell it today you would earn a total of 100.00 from holding Loral Space Communications 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 |
Loral Space Communications vs. Ciena Corp
Performance |
| Timeline |
| Loral Space Communic |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Ciena Corp |
Loral Space and Ciena Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Loral Space and Ciena Corp
The main advantage of trading using opposite Loral Space and Ciena Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Loral Space position performs unexpectedly, Ciena Corp 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 Ciena Corp will offset losses from the drop in Ciena Corp's long position.| Loral Space vs. Yuexiu Transport Infrastructure | Loral Space vs. Luxfer Holdings PLC | Loral Space vs. Avient Corp | Loral Space vs. Barrick Gold Corp |
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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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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