Correlation Between Lindeman Asia and SV Investment
Can any of the company-specific risk be diversified away by investing in both Lindeman Asia and SV 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 Lindeman Asia and SV Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lindeman Asia Investment and SV Investment, you can compare the effects of market volatilities on Lindeman Asia and SV 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 Lindeman Asia with a short position of SV Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lindeman Asia and SV Investment.
Diversification Opportunities for Lindeman Asia and SV Investment
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Lindeman and 289080 is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Lindeman Asia Investment and SV Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SV Investment and Lindeman Asia 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 Lindeman Asia Investment are associated (or correlated) with SV Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SV Investment has no effect on the direction of Lindeman Asia i.e., Lindeman Asia and SV Investment go up and down completely randomly.
Pair Corralation between Lindeman Asia and SV Investment
Assuming the 90 days trading horizon Lindeman Asia Investment is expected to under-perform the SV Investment. In addition to that, Lindeman Asia is 1.48 times more volatile than SV Investment. It trades about -0.13 of its total potential returns per unit of risk. SV Investment is currently generating about -0.17 per unit of volatility. If you would invest 157,800 in SV Investment on August 29, 2024 and sell it today you would lose (13,800) from holding SV Investment or give up 8.75% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lindeman Asia Investment vs. SV Investment
Performance |
| Timeline |
| Lindeman Asia Investment |
| SV Investment |
Lindeman Asia and SV Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lindeman Asia and SV Investment
The main advantage of trading using opposite Lindeman Asia and SV Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lindeman Asia position performs unexpectedly, SV 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 SV Investment will offset losses from the drop in SV Investment's long position.| Lindeman Asia vs. Nh Investment And | Lindeman Asia vs. Hanwha InvestmentSecurities Co | Lindeman Asia vs. DSC Investment | Lindeman Asia vs. Busan Industrial Co |
| SV Investment vs. Daou Data Corp | SV Investment vs. Aju IB Investment | SV Investment vs. EBEST Investment Securities | SV Investment vs. Atinum Investment 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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