Correlation Between Standard and Luminar Technologies
Can any of the company-specific risk be diversified away by investing in both Standard and Luminar Technologies 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 Standard and Luminar Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Standard Motor Products and Luminar Technologies, you can compare the effects of market volatilities on Standard and Luminar Technologies 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 Standard with a short position of Luminar Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Standard and Luminar Technologies.
Diversification Opportunities for Standard and Luminar Technologies
-0.8 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Standard and Luminar is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Standard Motor Products and Luminar Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Luminar Technologies and Standard 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 Standard Motor Products are associated (or correlated) with Luminar Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Luminar Technologies has no effect on the direction of Standard i.e., Standard and Luminar Technologies go up and down completely randomly.
Pair Corralation between Standard and Luminar Technologies
Considering the 90-day investment horizon Standard Motor Products is expected to generate 0.37 times more return on investment than Luminar Technologies. However, Standard Motor Products is 2.74 times less risky than Luminar Technologies. It trades about 0.16 of its potential returns per unit of risk. Luminar Technologies is currently generating about -0.08 per unit of risk. If you would invest 3,155 in Standard Motor Products on July 20, 2025 and sell it today you would earn a total of 800.00 from holding Standard Motor Products or generate 25.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Standard Motor Products vs. Luminar Technologies
Performance |
| Timeline |
| Standard Motor Products |
| Luminar Technologies |
Standard and Luminar Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Standard and Luminar Technologies
The main advantage of trading using opposite Standard and Luminar Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Standard position performs unexpectedly, Luminar Technologies 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 Luminar Technologies will offset losses from the drop in Luminar Technologies' long position.| Standard vs. Xpel Inc | Standard vs. Douglas Dynamics | Standard vs. American Axle Manufacturing | Standard vs. Fox Factory Holding |
| Luminar Technologies vs. Aeye Inc | Luminar Technologies vs. RideNow Group, | Luminar Technologies vs. China Automotive Systems | Luminar Technologies vs. Vroom, Common Stock |
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 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..
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