Correlation Between Magna International and Lydall
Can any of the company-specific risk be diversified away by investing in both Magna International and Lydall 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 Magna International and Lydall into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Magna International and Lydall Inc, you can compare the effects of market volatilities on Magna International and Lydall 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 Magna International with a short position of Lydall. Check out your portfolio center. Please also check ongoing floating volatility patterns of Magna International and Lydall.
Diversification Opportunities for Magna International and Lydall
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Magna and Lydall is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Magna International and Lydall Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lydall Inc and Magna International 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 Magna International are associated (or correlated) with Lydall. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lydall Inc has no effect on the direction of Magna International i.e., Magna International and Lydall go up and down completely randomly.
Pair Corralation between Magna International and Lydall
If you would invest (100.00) in Lydall Inc on January 26, 2024 and sell it today you would earn a total of 100.00 from holding Lydall Inc 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 |
Magna International vs. Lydall Inc
Performance |
| Timeline |
| Magna International |
| Lydall Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Magna International and Lydall Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Magna International and Lydall
The main advantage of trading using opposite Magna International and Lydall positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Magna International position performs unexpectedly, Lydall 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 Lydall will offset losses from the drop in Lydall's long position.| Magna International vs. Faraday Future Intelligent | Magna International vs. Mullen Automotive | Magna International vs. Xpeng Inc | Magna International vs. Nio Class A |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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