Correlation Between ABACUS STORAGE and Lendlease
Can any of the company-specific risk be diversified away by investing in both ABACUS STORAGE 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 ABACUS STORAGE and Lendlease into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ABACUS STORAGE KING and Lendlease Group, you can compare the effects of market volatilities on ABACUS STORAGE 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 ABACUS STORAGE with a short position of Lendlease. Check out your portfolio center. Please also check ongoing floating volatility patterns of ABACUS STORAGE and Lendlease.
Diversification Opportunities for ABACUS STORAGE and Lendlease
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ABACUS and Lendlease is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding ABACUS STORAGE KING and Lendlease Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lendlease Group and ABACUS STORAGE 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 ABACUS STORAGE KING 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 ABACUS STORAGE i.e., ABACUS STORAGE and Lendlease go up and down completely randomly.
Pair Corralation between ABACUS STORAGE and Lendlease
Assuming the 90 days trading horizon ABACUS STORAGE KING is expected to under-perform the Lendlease. But the stock apears to be less risky and, when comparing its historical volatility, ABACUS STORAGE KING is 1.28 times less risky than Lendlease. The stock trades about -0.06 of its potential returns per unit of risk. The Lendlease Group is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 672.00 in Lendlease Group on September 2, 2024 and sell it today you would earn a total of 44.00 from holding Lendlease Group or generate 6.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ABACUS STORAGE KING vs. Lendlease Group
Performance |
| Timeline |
| ABACUS STORAGE KING |
| Lendlease Group |
ABACUS STORAGE and Lendlease Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ABACUS STORAGE and Lendlease
The main advantage of trading using opposite ABACUS STORAGE and Lendlease positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ABACUS STORAGE 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.| ABACUS STORAGE vs. Westpac Banking | ABACUS STORAGE vs. Odyssey Energy | ABACUS STORAGE vs. Imricor Medical Systems | ABACUS STORAGE vs. Midway |
| Lendlease vs. Scentre Group | Lendlease vs. Vicinity Centres Re | Lendlease vs. Charter Hall Retail | Lendlease vs. Cromwell Property Group |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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