Correlation Between Alternative Investment and Lendlease
Can any of the company-specific risk be diversified away by investing in both Alternative Investment 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 Alternative Investment and Lendlease into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alternative Investment Trust and Lendlease Group, you can compare the effects of market volatilities on Alternative Investment 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 Alternative Investment with a short position of Lendlease. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alternative Investment and Lendlease.
Diversification Opportunities for Alternative Investment and Lendlease
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Alternative and Lendlease is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Alternative Investment Trust and Lendlease Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lendlease Group and Alternative Investment 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 Alternative Investment Trust 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 Alternative Investment i.e., Alternative Investment and Lendlease go up and down completely randomly.
Pair Corralation between Alternative Investment and Lendlease
If you would invest 676.00 in Lendlease Group on August 29, 2024 and sell it today you would earn a total of 8.00 from holding Lendlease Group or generate 1.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alternative Investment Trust vs. Lendlease Group
Performance |
| Timeline |
| Alternative Investment |
| Lendlease Group |
Alternative Investment and Lendlease Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alternative Investment and Lendlease
The main advantage of trading using opposite Alternative Investment and Lendlease positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alternative Investment 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.| Alternative Investment vs. National Australia Bank | Alternative Investment vs. National Australia Bank | Alternative Investment vs. Westpac Banking | Alternative Investment vs. National Australia Bank |
| Lendlease vs. M3 Mining | Lendlease vs. Auctus Alternative Investments | Lendlease vs. Alternative Investment Trust | Lendlease vs. K2 Asset Management |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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