Correlation Between Lamar Advertising and Apple
Can any of the company-specific risk be diversified away by investing in both Lamar Advertising and Apple 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 Lamar Advertising and Apple into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lamar Advertising and Apple Inc, you can compare the effects of market volatilities on Lamar Advertising and Apple 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 Lamar Advertising with a short position of Apple. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lamar Advertising and Apple.
Diversification Opportunities for Lamar Advertising and Apple
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lamar and Apple is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Lamar Advertising and Apple Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc and Lamar Advertising 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 Lamar Advertising are associated (or correlated) with Apple. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apple Inc has no effect on the direction of Lamar Advertising i.e., Lamar Advertising and Apple go up and down completely randomly.
Pair Corralation between Lamar Advertising and Apple
Assuming the 90 days trading horizon Lamar Advertising is expected to generate 1.06 times less return on investment than Apple. In addition to that, Lamar Advertising is 1.52 times more volatile than Apple Inc. It trades about 0.07 of its total potential returns per unit of risk. Apple Inc is currently generating about 0.11 per unit of volatility. If you would invest 21,574 in Apple Inc on August 30, 2024 and sell it today you would earn a total of 631.00 from holding Apple Inc or generate 2.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Lamar Advertising vs. Apple Inc
Performance |
| Timeline |
| Lamar Advertising |
| Apple Inc |
Lamar Advertising and Apple Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lamar Advertising and Apple
The main advantage of trading using opposite Lamar Advertising and Apple positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lamar Advertising position performs unexpectedly, Apple 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 Apple will offset losses from the drop in Apple's long position.| Lamar Advertising vs. Apple Inc | Lamar Advertising vs. Apple Inc | Lamar Advertising vs. Apple Inc | Lamar Advertising vs. Apple Inc |
| Apple vs. MUTUIONLINE | Apple vs. National Retail Properties | Apple vs. Lamar Advertising | Apple vs. BOS BETTER ONLINE |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
Other Complementary Tools
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |