Correlation Between American Express and Lloyds Banking
Can any of the company-specific risk be diversified away by investing in both American Express and Lloyds Banking 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 American Express and Lloyds Banking into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Express and Lloyds Banking Group, you can compare the effects of market volatilities on American Express and Lloyds Banking 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 American Express with a short position of Lloyds Banking. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Express and Lloyds Banking.
Diversification Opportunities for American Express and Lloyds Banking
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between American and Lloyds is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding American Express and Lloyds Banking Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lloyds Banking Group and American Express 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 American Express are associated (or correlated) with Lloyds Banking. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lloyds Banking Group has no effect on the direction of American Express i.e., American Express and Lloyds Banking go up and down completely randomly.
Pair Corralation between American Express and Lloyds Banking
If you would invest 586,740 in American Express on September 18, 2024 and sell it today you would earn a total of 22,970 from holding American Express or generate 3.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Express vs. Lloyds Banking Group
Performance |
| Timeline |
| American Express |
| Lloyds Banking Group |
American Express and Lloyds Banking Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Express and Lloyds Banking
The main advantage of trading using opposite American Express and Lloyds Banking positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Express position performs unexpectedly, Lloyds Banking 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 Lloyds Banking will offset losses from the drop in Lloyds Banking's long position.| American Express vs. Capital One Financial | American Express vs. Financiera Independencia SAB | American Express vs. The Select Sector | American Express vs. Promotora y Operadora |
| Lloyds Banking vs. Apple Inc | Lloyds Banking vs. Microsoft | Lloyds Banking vs. Alphabet Inc Class A | Lloyds Banking vs. Alphabet Inc |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
Other Complementary Tools
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| 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 | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Stocks Directory Find actively traded stocks across global markets | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges |