Correlation Between Lime Technologies and XMReality

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

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

Diversification Opportunities for Lime Technologies and XMReality

-0.37

Correlation Coefficient

Lime Technologies  XMReality

Very good diversification

The 3 months correlation between Lime and XMReality is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Lime Technologies AB and XMReality AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XMReality AB and Lime Technologies 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 Lime Technologies AB are associated (or correlated) with XMReality. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XMReality AB has no effect on the direction of Lime Technologies i.e., Lime Technologies and XMReality go up and down completely randomly.

Pair Corralation between Lime Technologies and XMReality

Assuming the 90 days trading horizon Lime Technologies is expected to generate 6.16 times less return on investment than XMReality. But when comparing it to its historical volatility, Lime Technologies AB is 3.71 times less risky than XMReality. It trades about 0.04 of its potential returns per unit of risk. XMReality AB is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  1.52  in XMReality AB on April 25, 2025 and sell it today you would earn a total of  0.28  from holding XMReality AB or generate 18.42% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Lime Technologies AB  vs.  XMReality AB

Lime Technologies

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Lime Technologies AB are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Lime Technologies is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

XMReality AB

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in XMReality AB are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, XMReality unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Lime Technologies and XMReality

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

The idea behind Lime Technologies AB and XMReality AB 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.