Correlation Between Acco Brands and Lee Enterprises
Can any of the company-specific risk be diversified away by investing in both Acco Brands and Lee Enterprises 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 Acco Brands and Lee Enterprises into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Acco Brands and Lee Enterprises Incorporated, you can compare the effects of market volatilities on Acco Brands and Lee Enterprises 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 Acco Brands with a short position of Lee Enterprises. Check out your portfolio center. Please also check ongoing floating volatility patterns of Acco Brands and Lee Enterprises.
Diversification Opportunities for Acco Brands and Lee Enterprises
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Acco and Lee is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Acco Brands and Lee Enterprises Incorporated in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lee Enterprises rporated and Acco Brands 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 Acco Brands are associated (or correlated) with Lee Enterprises. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lee Enterprises rporated has no effect on the direction of Acco Brands i.e., Acco Brands and Lee Enterprises go up and down completely randomly.
Pair Corralation between Acco Brands and Lee Enterprises
Given the investment horizon of 90 days Acco Brands is expected to under-perform the Lee Enterprises. But the stock apears to be less risky and, when comparing its historical volatility, Acco Brands is 2.73 times less risky than Lee Enterprises. The stock trades about -0.2 of its potential returns per unit of risk. The Lee Enterprises Incorporated is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 983.00 in Lee Enterprises Incorporated on January 25, 2024 and sell it today you would earn a total of 282.00 from holding Lee Enterprises Incorporated or generate 28.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Acco Brands vs. Lee Enterprises Incorporated
Performance |
| Timeline |
| Acco Brands |
| Lee Enterprises rporated |
Acco Brands and Lee Enterprises Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Acco Brands and Lee Enterprises
The main advantage of trading using opposite Acco Brands and Lee Enterprises positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Acco Brands position performs unexpectedly, Lee Enterprises 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 Lee Enterprises will offset losses from the drop in Lee Enterprises' long position.| Acco Brands vs. HNI Corp | Acco Brands vs. Steelcase | Acco Brands vs. Ennis Inc | Acco Brands vs. Acacia Research |
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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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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