Correlation Between Fonix Mobile and LPKF Laser

Can any of the company-specific risk be diversified away by investing in both Fonix Mobile and LPKF Laser 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 Fonix Mobile and LPKF Laser into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Fonix Mobile plc and LPKF Laser Electronics, you can compare the effects of market volatilities on Fonix Mobile and LPKF Laser 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 Fonix Mobile with a short position of LPKF Laser. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fonix Mobile and LPKF Laser.

Diversification Opportunities for Fonix Mobile and LPKF Laser

0.29

Correlation Coefficient

Fonix Mobile  LPKF Laser

Modest diversification

The 3 months correlation between Fonix and LPKF is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Fonix Mobile plc and LPKF Laser Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LPKF Laser Electronics and Fonix Mobile 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 Fonix Mobile plc are associated (or correlated) with LPKF Laser. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LPKF Laser Electronics has no effect on the direction of Fonix Mobile i.e., Fonix Mobile and LPKF Laser go up and down completely randomly.

Pair Corralation between Fonix Mobile and LPKF Laser

Assuming the 90 days trading horizon Fonix Mobile is expected to generate 1.33 times less return on investment than LPKF Laser. But when comparing it to its historical volatility, Fonix Mobile plc is 1.02 times less risky than LPKF Laser. It trades about 0.04 of its potential returns per unit of risk. LPKF Laser Electronics is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  824.00  in LPKF Laser Electronics on April 23, 2025 and sell it today you would earn a total of  45.00  from holding LPKF Laser Electronics or generate 5.46% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Fonix Mobile plc  vs.  LPKF Laser Electronics

Fonix Mobile plc

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Fonix Mobile plc are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound technical and fundamental indicators, Fonix Mobile is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

LPKF Laser Electronics

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in LPKF Laser Electronics are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, LPKF Laser may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Fonix Mobile and LPKF Laser

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

The idea behind Fonix Mobile plc and LPKF Laser Electronics 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.