Correlation Between LCI Industries and Leatt Corp
Can any of the company-specific risk be diversified away by investing in both LCI Industries and Leatt 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 LCI Industries and Leatt Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LCI Industries and Leatt Corp, you can compare the effects of market volatilities on LCI Industries and Leatt 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 LCI Industries with a short position of Leatt Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of LCI Industries and Leatt Corp.
Diversification Opportunities for LCI Industries and Leatt Corp
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between LCI and Leatt is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding LCI Industries and Leatt Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Leatt Corp and LCI Industries 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 LCI Industries are associated (or correlated) with Leatt Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Leatt Corp has no effect on the direction of LCI Industries i.e., LCI Industries and Leatt Corp go up and down completely randomly.
Pair Corralation between LCI Industries and Leatt Corp
Given the investment horizon of 90 days LCI Industries is expected to generate 0.69 times more return on investment than Leatt Corp. However, LCI Industries is 1.46 times less risky than Leatt Corp. It trades about -0.12 of its potential returns per unit of risk. Leatt Corp is currently generating about -0.27 per unit of risk. If you would invest 11,102 in LCI Industries on January 19, 2024 and sell it today you would lose (752.00) from holding LCI Industries or give up 6.77% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
LCI Industries vs. Leatt Corp
Performance |
| Timeline |
| LCI Industries |
| Leatt Corp |
LCI Industries and Leatt Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LCI Industries and Leatt Corp
The main advantage of trading using opposite LCI Industries and Leatt Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LCI Industries position performs unexpectedly, Leatt 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 Leatt Corp will offset losses from the drop in Leatt Corp's long position.| LCI Industries vs. MCBC Holdings | LCI Industries vs. Malibu Boats | LCI Industries vs. Marine Products | LCI Industries vs. Brunswick |
| Leatt Corp vs. Intema Solutions | Leatt Corp vs. 888 Holdings | Leatt Corp vs. Royal Wins | Leatt Corp vs. Churchill Downs Incorporated |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
Other Complementary Tools
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Stocks Directory Find actively traded stocks across global markets | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| AI Investment Finder Use AI to screen and filter profitable investment opportunities |