Correlation Between Archer Exploration and Lendlease
Can any of the company-specific risk be diversified away by investing in both Archer Exploration 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 Archer Exploration and Lendlease into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Archer Exploration and Lendlease Group, you can compare the effects of market volatilities on Archer Exploration 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 Archer Exploration with a short position of Lendlease. Check out your portfolio center. Please also check ongoing floating volatility patterns of Archer Exploration and Lendlease.
Diversification Opportunities for Archer Exploration and Lendlease
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Archer and Lendlease is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Archer Exploration and Lendlease Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lendlease Group and Archer Exploration 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 Archer Exploration 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 Archer Exploration i.e., Archer Exploration and Lendlease go up and down completely randomly.
Pair Corralation between Archer Exploration and Lendlease
Assuming the 90 days trading horizon Archer Exploration is expected to generate 30.84 times less return on investment than Lendlease. In addition to that, Archer Exploration is 4.11 times more volatile than Lendlease Group. It trades about 0.0 of its total potential returns per unit of risk. Lendlease Group is currently generating about 0.14 per unit of volatility. If you would invest 569.00 in Lendlease Group on September 5, 2024 and sell it today you would earn a total of 167.00 from holding Lendlease Group or generate 29.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Archer Exploration vs. Lendlease Group
Performance |
| Timeline |
| Archer Exploration |
| Lendlease Group |
Archer Exploration and Lendlease Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Archer Exploration and Lendlease
The main advantage of trading using opposite Archer Exploration and Lendlease positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Archer Exploration 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.| Archer Exploration vs. Macquarie Technology Group | Archer Exploration vs. Medical Developments International | Archer Exploration vs. Hotel Property Investments | Archer Exploration vs. Charter Hall Retail |
| 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 Positions Ratings module to 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.
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