Correlation Between LLOYDS METALS and Electronics Mart

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

By analyzing existing cross correlation between LLOYDS METALS AND and Electronics Mart India, you can compare the effects of market volatilities on LLOYDS METALS and Electronics Mart 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 LLOYDS METALS with a short position of Electronics Mart. Check out your portfolio center. Please also check ongoing floating volatility patterns of LLOYDS METALS and Electronics Mart.

Diversification Opportunities for LLOYDS METALS and Electronics Mart

0.35

Correlation Coefficient

LLOYDS METALS  Electronics Mart

Weak diversification

The 3 months correlation between LLOYDS and Electronics is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding LLOYDS METALS AND and Electronics Mart India in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Electronics Mart India and LLOYDS METALS 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 LLOYDS METALS AND are associated (or correlated) with Electronics Mart. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Electronics Mart India has no effect on the direction of LLOYDS METALS i.e., LLOYDS METALS and Electronics Mart go up and down completely randomly.

Pair Corralation between LLOYDS METALS and Electronics Mart

Assuming the 90 days trading horizon LLOYDS METALS AND is expected to generate 1.75 times more return on investment than Electronics Mart. However, LLOYDS METALS is 1.75 times more volatile than Electronics Mart India. It trades about 0.06 of its potential returns per unit of risk. Electronics Mart India is currently generating about -0.27 per unit of risk. If you would invest  150,220  in LLOYDS METALS AND on April 23, 2025 and sell it today you would earn a total of  2,720  from holding LLOYDS METALS AND or generate 1.81% return on investment over 90 days.

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

LLOYDS METALS AND  vs.  Electronics Mart India

LLOYDS METALS AND

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in LLOYDS METALS AND are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain basic indicators, LLOYDS METALS displayed solid returns over the last few months and may actually be approaching a breakup point.

Electronics Mart India

Risk-Adjusted Performance

Very Weak

Over the last 90 days Electronics Mart India has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Electronics Mart is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with LLOYDS METALS and Electronics Mart

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

The idea behind LLOYDS METALS AND and Electronics Mart India 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..