Correlation Between LightPath Technologies and Microvision

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

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

Diversification Opportunities for LightPath Technologies and Microvision

0.75

Correlation Coefficient

LightPath Technologies  Microvision

Poor diversification

The 3 months correlation between LightPath and Microvision is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding LightPath Technologies and Microvision in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Microvision and LightPath 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 LightPath Technologies are associated (or correlated) with Microvision. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Microvision has no effect on the direction of LightPath Technologies i.e., LightPath Technologies and Microvision go up and down completely randomly.

Pair Corralation between LightPath Technologies and Microvision

Given the investment horizon of 90 days LightPath Technologies is expected to generate 2.24 times more return on investment than Microvision. However, LightPath Technologies is 2.24 times more volatile than Microvision. It trades about 0.07 of its potential returns per unit of risk. Microvision is currently generating about 0.01 per unit of risk. If you would invest  815.00  in LightPath Technologies on July 30, 2025 and sell it today you would earn a total of  29.00  from holding LightPath Technologies or generate 3.56% return on investment over 90 days.

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

LightPath Technologies  vs.  Microvision

LightPath Technologies

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in LightPath Technologies are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. Despite fairly uncertain basic indicators, LightPath Technologies demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Microvision

Risk-Adjusted Performance

Mild

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

Pair Trading with LightPath Technologies and Microvision

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

The idea behind LightPath Technologies and Microvision 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.