Correlation Between Tower One and Lendlease
Can any of the company-specific risk be diversified away by investing in both Tower One 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 Tower One and Lendlease into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tower One Wireless and Lendlease Group, you can compare the effects of market volatilities on Tower One 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 Tower One with a short position of Lendlease. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tower One and Lendlease.
Diversification Opportunities for Tower One and Lendlease
Pay attention - limited upside
The 3 months correlation between Tower and Lendlease is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Tower One Wireless and Lendlease Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lendlease Group and Tower One 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 Tower One Wireless 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 Tower One i.e., Tower One and Lendlease go up and down completely randomly.
Pair Corralation between Tower One and Lendlease
If you would invest 405.00 in Lendlease Group on September 1, 2024 and sell it today you would earn a total of 27.00 from holding Lendlease Group or generate 6.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tower One Wireless vs. Lendlease Group
Performance |
| Timeline |
| Tower One Wireless |
| Lendlease Group |
Tower One and Lendlease Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tower One and Lendlease
The main advantage of trading using opposite Tower One and Lendlease positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tower One 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.| Tower One vs. Titan Machinery | Tower One vs. Granite Construction | Tower One vs. Dairy Farm International | Tower One vs. ITALIAN WINE BRANDS |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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