Correlation Between Victory Integrity and Lumen Technologies

Can any of the company-specific risk be diversified away by investing in both Victory Integrity and Lumen Technologies 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 Victory Integrity and Lumen Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Victory Integrity Smallmid Cap and Lumen Technologies, you can compare the effects of market volatilities on Victory Integrity and Lumen Technologies 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 Victory Integrity with a short position of Lumen Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Victory Integrity and Lumen Technologies.

Diversification Opportunities for Victory Integrity and Lumen Technologies

0.55

Correlation Coefficient

Victory Integrity  Lumen Technologies

Very weak diversification

The 3 months correlation between Victory and Lumen is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Victory Integrity Smallmid Cap and Lumen Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lumen Technologies and Victory Integrity 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 Victory Integrity Smallmid Cap are associated (or correlated) with Lumen Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lumen Technologies has no effect on the direction of Victory Integrity i.e., Victory Integrity and Lumen Technologies go up and down completely randomly.

Pair Corralation between Victory Integrity and Lumen Technologies

Assuming the 90 days horizon Victory Integrity is expected to generate 1.38 times less return on investment than Lumen Technologies. But when comparing it to its historical volatility, Victory Integrity Smallmid Cap is 4.49 times less risky than Lumen Technologies. It trades about 0.13 of its potential returns per unit of risk. Lumen Technologies is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  609.00  in Lumen Technologies on September 13, 2024 and sell it today you would earn a total of  31.00  from holding Lumen Technologies or generate 5.09% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.44%
Values	Daily Returns

Victory Integrity Smallmid Cap  vs.  Lumen Technologies

Victory Integrity

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Victory Integrity Smallmid Cap are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Victory Integrity may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Lumen Technologies

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Lumen Technologies are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very weak primary indicators, Lumen Technologies may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Victory Integrity and Lumen Technologies

The main advantage of trading using opposite Victory Integrity and Lumen Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Victory Integrity position performs unexpectedly, Lumen Technologies 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 Lumen Technologies will offset losses from the drop in Lumen Technologies' long position.

The idea behind Victory Integrity Smallmid Cap and Lumen Technologies pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.