Correlation Between United Insurance and Lendlease
Can any of the company-specific risk be diversified away by investing in both United Insurance and Lendlease 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 United Insurance and Lendlease into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United Insurance Holdings and Lendlease Group, you can compare the effects of market volatilities on United Insurance and Lendlease 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 United Insurance with a short position of Lendlease. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Insurance and Lendlease.
Diversification Opportunities for United Insurance and Lendlease
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between United and Lendlease is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding United Insurance Holdings and Lendlease Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lendlease Group and United Insurance 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 United Insurance Holdings are associated (or correlated) with Lendlease. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lendlease Group has no effect on the direction of United Insurance i.e., United Insurance and Lendlease go up and down completely randomly.
Pair Corralation between United Insurance and Lendlease
Assuming the 90 days horizon United Insurance Holdings is expected to generate 1.49 times more return on investment than Lendlease. However, United Insurance is 1.49 times more volatile than Lendlease Group. It trades about -0.03 of its potential returns per unit of risk. Lendlease Group is currently generating about -0.16 per unit of risk. If you would invest 1,229 in United Insurance Holdings on October 26, 2024 and sell it today you would lose (49.00) from holding United Insurance Holdings or give up 3.99% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
United Insurance Holdings vs. Lendlease Group
Performance |
| Timeline |
| United Insurance Holdings |
| Lendlease Group |
United Insurance and Lendlease Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Insurance and Lendlease
The main advantage of trading using opposite United Insurance and Lendlease positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Insurance position performs unexpectedly, Lendlease 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 Lendlease will offset losses from the drop in Lendlease's long position.| United Insurance vs. PICC Property and | United Insurance vs. Fairfax Financial Holdings | United Insurance vs. QBE Insurance Group | United Insurance vs. Insurance Australia Group |
| Lendlease vs. VIENNA INSURANCE GR | Lendlease vs. Sims Metal Management | Lendlease vs. Corporate Travel Management | Lendlease vs. United Insurance 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 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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