Correlation Between Booking Holdings and Lowes Companies
Can any of the company-specific risk be diversified away by investing in both Booking Holdings and Lowes Companies 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 Booking Holdings and Lowes Companies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Booking Holdings and Lowes Companies, you can compare the effects of market volatilities on Booking Holdings and Lowes Companies 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 Booking Holdings with a short position of Lowes Companies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Booking Holdings and Lowes Companies.
Diversification Opportunities for Booking Holdings and Lowes Companies
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Booking and Lowes is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Booking Holdings and Lowes Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lowes Companies and Booking Holdings 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 Booking Holdings are associated (or correlated) with Lowes Companies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lowes Companies has no effect on the direction of Booking Holdings i.e., Booking Holdings and Lowes Companies go up and down completely randomly.
Pair Corralation between Booking Holdings and Lowes Companies
Given the investment horizon of 90 days Booking Holdings is expected to generate 1.45 times less return on investment than Lowes Companies. In addition to that, Booking Holdings is 1.28 times more volatile than Lowes Companies. It trades about 0.04 of its total potential returns per unit of risk. Lowes Companies is currently generating about 0.07 per unit of volatility. If you would invest 23,352 in Lowes Companies on October 9, 2025 and sell it today you would earn a total of 1,297 from holding Lowes Companies or generate 5.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Booking Holdings vs. Lowes Companies
Performance |
| Timeline |
| Booking Holdings |
| Lowes Companies |
Booking Holdings and Lowes Companies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Booking Holdings and Lowes Companies
The main advantage of trading using opposite Booking Holdings and Lowes Companies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Booking Holdings position performs unexpectedly, Lowes Companies 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 Lowes Companies will offset losses from the drop in Lowes Companies' long position.| Booking Holdings vs. The TJX Companies | Booking Holdings vs. Airbnb Inc | Booking Holdings vs. PDD Holdings | Booking Holdings vs. Lowes Companies |
| Lowes Companies vs. The TJX Companies | Lowes Companies vs. Nike Inc | Lowes Companies vs. MercadoLibre | Lowes Companies vs. PDD Holdings |
Check out your portfolio center.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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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