Correlation Between Peijia Medical and Lendlease
Can any of the company-specific risk be diversified away by investing in both Peijia Medical 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 Peijia Medical and Lendlease into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Peijia Medical Limited and Lendlease Group, you can compare the effects of market volatilities on Peijia Medical 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 Peijia Medical with a short position of Lendlease. Check out your portfolio center. Please also check ongoing floating volatility patterns of Peijia Medical and Lendlease.
Diversification Opportunities for Peijia Medical and Lendlease
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Peijia and Lendlease is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Peijia Medical Limited and Lendlease Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lendlease Group and Peijia Medical 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 Peijia Medical Limited 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 Peijia Medical i.e., Peijia Medical and Lendlease go up and down completely randomly.
Pair Corralation between Peijia Medical and Lendlease
Assuming the 90 days horizon Peijia Medical Limited is expected to under-perform the Lendlease. In addition to that, Peijia Medical is 1.53 times more volatile than Lendlease Group. It trades about -0.18 of its total potential returns per unit of risk. Lendlease Group is currently generating about 0.07 per unit of volatility. If you would invest 378.00 in Lendlease Group on November 5, 2024 and sell it today you would earn a total of 8.00 from holding Lendlease Group or generate 2.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Peijia Medical Limited vs. Lendlease Group
Performance |
| Timeline |
| Peijia Medical |
| Lendlease Group |
Peijia Medical and Lendlease Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Peijia Medical and Lendlease
The main advantage of trading using opposite Peijia Medical and Lendlease positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Peijia Medical 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.| Peijia Medical vs. BJs Restaurants | Peijia Medical vs. RCI Hospitality Holdings | Peijia Medical vs. HEALTHSTREAM | Peijia Medical vs. Acadia Healthcare |
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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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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