Correlation Between MT Bank and Lloyds Banking
Can any of the company-specific risk be diversified away by investing in both MT Bank and Lloyds Banking 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 MT Bank and Lloyds Banking into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MT Bank Corp and Lloyds Banking Group, you can compare the effects of market volatilities on MT Bank and Lloyds Banking 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 MT Bank with a short position of Lloyds Banking. Check out your portfolio center. Please also check ongoing floating volatility patterns of MT Bank and Lloyds Banking.
Diversification Opportunities for MT Bank and Lloyds Banking
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 0JW2 and Lloyds is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding MT Bank Corp and Lloyds Banking Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lloyds Banking Group and MT Bank 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 MT Bank Corp are associated (or correlated) with Lloyds Banking. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lloyds Banking Group has no effect on the direction of MT Bank i.e., MT Bank and Lloyds Banking go up and down completely randomly.
Pair Corralation between MT Bank and Lloyds Banking
Assuming the 90 days trading horizon MT Bank Corp is expected to under-perform the Lloyds Banking. In addition to that, MT Bank is 8.47 times more volatile than Lloyds Banking Group. It trades about -0.11 of its total potential returns per unit of risk. Lloyds Banking Group is currently generating about 0.31 per unit of volatility. If you would invest 13,940 in Lloyds Banking Group on September 12, 2024 and sell it today you would earn a total of 125.00 from holding Lloyds Banking Group or generate 0.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
MT Bank Corp vs. Lloyds Banking Group
Performance |
| Timeline |
| MT Bank Corp |
| Lloyds Banking Group |
MT Bank and Lloyds Banking Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MT Bank and Lloyds Banking
The main advantage of trading using opposite MT Bank and Lloyds Banking positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MT Bank position performs unexpectedly, Lloyds Banking 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 Lloyds Banking will offset losses from the drop in Lloyds Banking's long position.| MT Bank vs. Hong Kong Land | MT Bank vs. Neometals | MT Bank vs. Coor Service Management | MT Bank vs. Fidelity Sustainable USD |
| Lloyds Banking vs. Toyota Motor Corp | Lloyds Banking vs. SoftBank Group Corp | Lloyds Banking vs. OTP Bank Nyrt | Lloyds Banking vs. Hershey Co |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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