Correlation Between Luminar Media and Itoco

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

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

Diversification Opportunities for Luminar Media and Itoco

-0.36

Correlation Coefficient

Luminar Media  Itoco

Very good diversification

The 3 months correlation between Luminar and Itoco is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Luminar Media Group and Itoco Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Itoco Inc and Luminar Media 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 Luminar Media Group are associated (or correlated) with Itoco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Itoco Inc has no effect on the direction of Luminar Media i.e., Luminar Media and Itoco go up and down completely randomly.

Pair Corralation between Luminar Media and Itoco

Given the investment horizon of 90 days Luminar Media Group is expected to generate 0.55 times more return on investment than Itoco. However, Luminar Media Group is 1.81 times less risky than Itoco. It trades about 0.07 of its potential returns per unit of risk. Itoco Inc is currently generating about 0.0 per unit of risk. If you would invest  8.00  in Luminar Media Group on May 12, 2025 and sell it today you would earn a total of  0.50  from holding Luminar Media Group or generate 6.25% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	96.92%
Values	Daily Returns

Luminar Media Group  vs.  Itoco Inc

Luminar Media Group

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Luminar Media Group are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Even with relatively unsteady technical and fundamental indicators, Luminar Media reported solid returns over the last few months and may actually be approaching a breakup point.

Itoco Inc

Risk-Adjusted Performance

Weakest

Over the last 90 days Itoco Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound primary indicators, Itoco is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Luminar Media and Itoco

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

The idea behind Luminar Media Group and Itoco Inc 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.