Correlation Between T3 Entertainment and LB Investment
Can any of the company-specific risk be diversified away by investing in both T3 Entertainment and LB Investment 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 T3 Entertainment and LB Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between T3 Entertainment Co and LB Investment, you can compare the effects of market volatilities on T3 Entertainment and LB Investment 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 T3 Entertainment with a short position of LB Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of T3 Entertainment and LB Investment.
Diversification Opportunities for T3 Entertainment and LB Investment
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between 204610 and 309960 is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding T3 Entertainment Co and LB Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LB Investment and T3 Entertainment 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 T3 Entertainment Co are associated (or correlated) with LB Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LB Investment has no effect on the direction of T3 Entertainment i.e., T3 Entertainment and LB Investment go up and down completely randomly.
Pair Corralation between T3 Entertainment and LB Investment
Assuming the 90 days trading horizon T3 Entertainment Co is expected to generate 2.03 times more return on investment than LB Investment. However, T3 Entertainment is 2.03 times more volatile than LB Investment. It trades about 0.22 of its potential returns per unit of risk. LB Investment is currently generating about -0.28 per unit of risk. If you would invest 132,200 in T3 Entertainment Co on September 5, 2024 and sell it today you would earn a total of 20,300 from holding T3 Entertainment Co or generate 15.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
T3 Entertainment Co vs. LB Investment
Performance |
| Timeline |
| T3 Entertainment |
| LB Investment |
T3 Entertainment and LB Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with T3 Entertainment and LB Investment
The main advantage of trading using opposite T3 Entertainment and LB Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if T3 Entertainment position performs unexpectedly, LB Investment 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 LB Investment will offset losses from the drop in LB Investment's long position.| T3 Entertainment vs. Samsung Electronics Co | T3 Entertainment vs. Samsung Electronics Co | T3 Entertainment vs. LG Energy Solution | T3 Entertainment vs. SK Hynix |
| LB Investment vs. Display Tech Co | LB Investment vs. Nice Information Telecommunication | LB Investment vs. Lotte Data Communication | LB Investment vs. Shinsegae Information Communication |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
Other Complementary Tools
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals |