Lightinthebox Stock Volatility

LITB -  USA Stock  

USD 1.17  0.03  2.50%

We consider Lightinthebox Holding dangerous. Lightinthebox Holding has Sharpe Ratio of 0.0175, which conveys that the firm had 0.0175% of return per unit of risk over the last 3 months. Our standpoint towards estimating the volatility of a stock is to use all available market data together with stock-specific technical indicators that cannot be diversified away. We have found twenty-six technical indicators for Lightinthebox Holding, which you can use to evaluate the future volatility of the firm. Please verify Lightinthebox Holding Co Risk Adjusted Performance of 0.0515, downside deviation of 4.56, and Mean Deviation of 3.33 to check out if the risk estimate we provide is consistent with the expected return of 0.0727%.
  
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Lightinthebox Holding Stock volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of Lightinthebox daily returns, and it is calculated using variance and standard deviation. We also use Lightinthebox's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of Lightinthebox Holding volatility.

360 Days Market Risk

Dangerous

Chance of Distress

Very Low

360 Days Economic Sensitivity

Follows the market closely
Since volatility provides investors with entry points to take advantage of stock prices, companies, such as Lightinthebox Holding can benefit from it. Downward market volatility can be a perfect environment for investors who play the long game. Here, they may decide to buy additional stocks of Lightinthebox Holding at lower prices. For example, an investor can purchase Lightinthebox stock that has halved in price over a short period. This will lower your average cost per share, thereby improving your portfolio's performance when the markets normalize. Similarly, when the prices of Lightinthebox Holding's stock rises, investors can sell out and invest the proceeds in other equities with better opportunities. Investing when markets are volatile with better valuations will accord both investors and companies the opportunity to generate better long-term returns.

Moving together with Lightinthebox Holding

0.65MPNGYMeituan Dianping RepstgPairCorr

Moving against Lightinthebox Holding

-0.59DEERDeer Consumer ProductsPairCorr
-0.56ACIAlbertsons Companies Financial Report 4th of August 2022 PairCorr
-0.55AGRIAgriforce Growing SystemsPairCorr
-0.53BWMXBetterware DE MexicoPairCorr

Lightinthebox Holding Market Sensitivity And Downside Risk

Lightinthebox Holding's beta coefficient measures the volatility of Lightinthebox stock compared to the systematic risk of the entire stock market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents Lightinthebox stock's returns against your selected market. In other words, Lightinthebox Holding's beta of 0.73 provides an investor with an approximation of how much risk Lightinthebox Holding stock can potentially add to one of your existing portfolios.
Let's try to break down what Lightinthebox's beta means in this case. As returns on the market increase, Lightinthebox Holding returns are expected to increase less than the market. However, during the bear market, the loss on holding Lightinthebox Holding will be expected to be smaller as well.
3 Months Beta |Analyze Lightinthebox Holding Demand Trend
Check current 90 days Lightinthebox Holding correlation with market (DOW)

Lightinthebox Beta

    
  0.73  
Lightinthebox standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. Typical volatile equity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.

Standard Deviation

    
  4.16  
It is essential to understand the difference between upside risk (as represented by Lightinthebox Holding's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of Lightinthebox Holding stock's daily returns or price. Since the actual investment returns on holding a position in Lightinthebox Holding stock tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in Lightinthebox Holding.

Lightinthebox Holding Stock Volatility Analysis

Volatility refers to the frequency at which Lightinthebox Holding stock price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with Lightinthebox Holding's price changes. Investors will then calculate the volatility of Lightinthebox Holding's stock to predict their future moves. A stock that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A stock with relatively stable price changes has low volatility. A highly volatile stock is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of Lightinthebox Holding's volatility:

Historical Volatility

This type of stock volatility measures Lightinthebox Holding's fluctuations based on previous trends. It's commonly used to predict Lightinthebox Holding's future behavior based on its past. However, it cannot conclusively determine the future direction of the stock.

Implied Volatility

This type of volatility provides a positive outlook on future price fluctuations for Lightinthebox Holding's current market price. This means that the stock will return to its initially predicted market price.
Transformation
The output start index for this execution was zero with a total number of output elements of sixty-one. Developed by Larry Williams, the Weighted Close is the average of Lightinthebox Holding high, low and close of a chart with the close values weighted twice. It can be used to smooth an indicator that normally takes only Lightinthebox Holding closing price as input.
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Lightinthebox Holding Projected Return Density Against Market

Given the investment horizon of 90 days Lightinthebox Holding has a beta of 0.7285 . This indicates as returns on the market go up, Lightinthebox Holding average returns are expected to increase less than the benchmark. However, during the bear market, the loss on holding Lightinthebox Holding Co will be expected to be much smaller as well.
Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Lightinthebox Holding or Consumer Cyclical sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Lightinthebox Holding stock's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Lightinthebox stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
The company has an alpha of 0.2073, implying that it can generate a 0.21 percent excess return over DOW after adjusting for the inherited market risk (beta).
 Predicted Return Density 
      Returns 
Lightinthebox Holding's volatility is measured either by using standard deviation or beta. Standard deviation will reflect the average amount of how Lightinthebox Holding stock's price will differ from the mean after some time.To get its calculation, you should first determine the mean price during the specified period then subtract that from each price point.

What Drives a Company's Stock Price Volatility?

Several factors can influence a company's stock volatility:

Industry

Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.

Political and Economic environment

When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.

The Company's Performance

Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.

Lightinthebox Holding Stock Risk Measures

Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Lightinthebox Holding or Consumer Cyclical sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Lightinthebox Holding stock's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Lightinthebox stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
Given the investment horizon of 90 days the coefficient of variation of Lightinthebox Holding is 5712.95. The daily returns are distributed with a variance of 17.26 and standard deviation of 4.16. The mean deviation of Lightinthebox Holding Co is currently at 3.37. For similar time horizon, the selected benchmark (DOW) has volatility of 1.36
α
Alpha over DOW
0.21
β
Beta against DOW0.73
σ
Overall volatility
4.16
Ir
Information ratio 0.06

Lightinthebox Holding Stock Return Volatility

Lightinthebox Holding historical daily return volatility represents how much Lightinthebox Holding stock's price daily returns swing around its mean daily price change - it is a statistical measure of its dispersion of returns. The company inherits 4.1551% risk (volatility on return distribution) over the 90 days horizon. By contrast, DOW inherits 1.3635% risk (volatility on return distribution) over the 90 days horizon.
 Performance (%) 
      Timeline 

About Lightinthebox Holding Volatility

Volatility is a rate at which the price of Lightinthebox Holding or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Lightinthebox Holding may increase or decrease. In other words, similar to Lightinthebox's beta indicator, it measures the risk of Lightinthebox Holding and helps estimate the fluctuations that may happen in a short period of time. So if prices of Lightinthebox Holding fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.
Last ReportedProjected for 2022
Market Capitalization113.3 M139.6 M
LightInTheBox Holding Co., Ltd. operates as a cross-border e-commerce platform that delivers products directly from manufacturers to its customers worldwide. LightInTheBox Holding Co., Ltd. was founded in 2007 and is headquartered in Shanghai, the Peoples Republic of China. Lightinthebox Holding operates under Internet Retail classification in the United States and is traded on New York Stock Exchange.

Lightinthebox Holding Investment Opportunity

Lightinthebox Holding Co has a volatility of 4.16 and is 3.06 times more volatile than DOW. 35  of all equities and portfolios are less risky than Lightinthebox Holding. Compared to the overall equity markets, volatility of historical daily returns of Lightinthebox Holding Co is lower than 35 () of all global equities and portfolios over the last 90 days. Use Lightinthebox Holding Co to protect your portfolios against small market fluctuations. The stock experiences an unexpected downward movement. The market is reacting to new fundamentals. Check odds of Lightinthebox Holding to be traded at $1.1232 in 90 days. . Let's try to break down what Lightinthebox's beta means in this case. As returns on the market increase, Lightinthebox Holding returns are expected to increase less than the market. However, during the bear market, the loss on holding Lightinthebox Holding will be expected to be smaller as well.

Modest diversification

The correlation between Lightinthebox Holding Co and DJI is Modest diversification for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Lightinthebox Holding Co and DJI in the same portfolio, assuming nothing else is changed.

Lightinthebox Holding Additional Risk Indicators

The analysis of Lightinthebox Holding's secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in Lightinthebox Holding's investment and either accepting that risk or mitigating it. Along with some common measures of Lightinthebox Holding stock risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
Risk Adjusted Performance0.0515
Market Risk Adjusted Performance0.1824
Mean Deviation3.33
Semi Deviation4.25
Downside Deviation4.56
Coefficient Of Variation3030.77
Standard Deviation4.11
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential stock investments, we recommend comparing similar equities with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.

Lightinthebox Holding Suggested Diversification Pairs

Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
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The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Lightinthebox Holding as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Lightinthebox Holding's systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Lightinthebox Holding's unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Lightinthebox Holding Co.
Additionally, see Stocks Correlation. Note that the Lightinthebox Holding information on this page should be used as a complementary analysis to other Lightinthebox Holding's statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.

Complementary Tools for Lightinthebox Stock analysis

When running Lightinthebox Holding price analysis, check to measure Lightinthebox Holding's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Lightinthebox Holding is operating at the current time. Most of Lightinthebox Holding's value examination focuses on studying past and present price action to predict the probability of Lightinthebox Holding's future price movements. You can analyze the entity against its peers and financial market as a whole to determine factors that move Lightinthebox Holding's price. Additionally, you may evaluate how the addition of Lightinthebox Holding to your portfolios can decrease your overall portfolio volatility.
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Is Lightinthebox Holding's industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Lightinthebox Holding. If investors know Lightinthebox will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Lightinthebox Holding listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
The market value of Lightinthebox Holding is measured differently than its book value, which is the value of Lightinthebox that is recorded on the company's balance sheet. Investors also form their own opinion of Lightinthebox Holding's value that differs from its market value or its book value, called intrinsic value, which is Lightinthebox Holding's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Lightinthebox Holding's market value can be influenced by many factors that don't directly affect Lightinthebox Holding's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Lightinthebox Holding's value and its price as these two are different measures arrived at by different means. Investors typically determine Lightinthebox Holding value by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Lightinthebox Holding's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.