Correlation Between Agilent Technologies and Lesico
Can any of the company-specific risk be diversified away by investing in both Agilent Technologies and Lesico 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 Agilent Technologies and Lesico into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Agilent Technologies and Lesico, you can compare the effects of market volatilities on Agilent Technologies and Lesico 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 Agilent Technologies with a short position of Lesico. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agilent Technologies and Lesico.
Diversification Opportunities for Agilent Technologies and Lesico
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Agilent and Lesico is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Agilent Technologies and Lesico in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lesico and Agilent Technologies 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 Agilent Technologies are associated (or correlated) with Lesico. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lesico has no effect on the direction of Agilent Technologies i.e., Agilent Technologies and Lesico go up and down completely randomly.
Pair Corralation between Agilent Technologies and Lesico
Taking into account the 90-day investment horizon Agilent Technologies is expected to under-perform the Lesico. But the stock apears to be less risky and, when comparing its historical volatility, Agilent Technologies is 1.47 times less risky than Lesico. The stock trades about -0.11 of its potential returns per unit of risk. The Lesico is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 30,450 in Lesico on January 25, 2024 and sell it today you would earn a total of 2,760 from holding Lesico or generate 9.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 77.27% |
| Values | Daily Returns |
Agilent Technologies vs. Lesico
Performance |
| Timeline |
| Agilent Technologies |
| Lesico |
Agilent Technologies and Lesico Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agilent Technologies and Lesico
The main advantage of trading using opposite Agilent Technologies and Lesico positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agilent Technologies position performs unexpectedly, Lesico 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 Lesico will offset losses from the drop in Lesico's long position.| Agilent Technologies vs. Fonar | Agilent Technologies vs. Burning Rock BiotechLtd | Agilent Technologies vs. Sera Prognostics | Agilent Technologies vs. Psychemedics |
| Lesico vs. Alony Hetz Properties | Lesico vs. Melisron | Lesico vs. Shufersal | Lesico vs. Israel Discount Bank |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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