Correlation Between Home Depot and Lumber Liquidators

Analyzing existing cross correlation between Home Depot and Lumber Liquidators Holdings In. You can compare the effects of market volatilities on Home Depot and Lumber Liquidators 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 Home Depot with a short position of Lumber Liquidators. Check out your portfolio center. Please also check ongoing floating volatility patterns of Home Depot and Lumber Liquidators.

Comparative Performance

Home Depot  

Risk-Adjusted Performance

Compared to the overall equity markets, risk-adjusted returns on investments in Home Depot are ranked lower than 14 (%) of all global equities and portfolios over the last 30 days. In spite of rather conflicting fundamental drivers, Home Depot may actually be approaching a critical reversion point that can send shares even higher in March 2020.
Lumber Liquidators  

Risk-Adjusted Performance

Over the last 30 days Lumber Liquidators Holdings In has generated negative risk-adjusted returns adding no value to investors with long positions. Even with considerably steady technical indicators, Lumber Liquidators is not utilizing all of its potentials. The existing stock price chaos, may contribute to medium term losses for the stakeholders.

Home Depot and Lumber Liquidators Volatility Contrast

 Predicted Return Density 

Home Depot Inc  vs.  Lumber Liquidators Holdings In

 Performance (%) 

Pair Volatility

Allowing for the 30-days total investment horizon, Home Depot is expected to generate 0.23 times more return on investment than Lumber Liquidators. However, Home Depot is 4.34 times less risky than Lumber Liquidators. It trades about 0.21 of its potential returns per unit of risk. Lumber Liquidators Holdings In is currently generating about -0.01 per unit of risk. If you would invest  21,854  in Home Depot on January 20, 2020 and sell it today you would earn a total of  2,540  from holding Home Depot or generate 11.62% return on investment over 30 days.

Pair Corralation between Home Depot and Lumber Liquidators

Time Period3 Months [change]
ValuesDaily Returns

Diversification Opportunities for Home Depot and Lumber Liquidators

Home Depot Inc diversification synergy

Pay attention

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