Correlation Between Bloomsbury Publishing and Liontrust Asset
Can any of the company-specific risk be diversified away by investing in both Bloomsbury Publishing and Liontrust Asset 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 Bloomsbury Publishing and Liontrust Asset into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bloomsbury Publishing Plc and Liontrust Asset Management, you can compare the effects of market volatilities on Bloomsbury Publishing and Liontrust Asset 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 Bloomsbury Publishing with a short position of Liontrust Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bloomsbury Publishing and Liontrust Asset.
Diversification Opportunities for Bloomsbury Publishing and Liontrust Asset
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Bloomsbury and Liontrust is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Bloomsbury Publishing Plc and Liontrust Asset Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Liontrust Asset Mana and Bloomsbury Publishing 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 Bloomsbury Publishing Plc are associated (or correlated) with Liontrust Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Liontrust Asset Mana has no effect on the direction of Bloomsbury Publishing i.e., Bloomsbury Publishing and Liontrust Asset go up and down completely randomly.
Pair Corralation between Bloomsbury Publishing and Liontrust Asset
Assuming the 90 days trading horizon Bloomsbury Publishing Plc is expected to generate 0.89 times more return on investment than Liontrust Asset. However, Bloomsbury Publishing Plc is 1.13 times less risky than Liontrust Asset. It trades about 0.02 of its potential returns per unit of risk. Liontrust Asset Management is currently generating about -0.06 per unit of risk. If you would invest 64,990 in Bloomsbury Publishing Plc on October 7, 2024 and sell it today you would earn a total of 2,210 from holding Bloomsbury Publishing Plc or generate 3.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bloomsbury Publishing Plc vs. Liontrust Asset Management
Performance |
| Timeline |
| Bloomsbury Publishing Plc |
| Liontrust Asset Mana |
Bloomsbury Publishing and Liontrust Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bloomsbury Publishing and Liontrust Asset
The main advantage of trading using opposite Bloomsbury Publishing and Liontrust Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bloomsbury Publishing position performs unexpectedly, Liontrust Asset 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 Liontrust Asset will offset losses from the drop in Liontrust Asset's long position.| Bloomsbury Publishing vs. Toyota Motor Corp | Bloomsbury Publishing vs. Halyk Bank of | Bloomsbury Publishing vs. Samsung Electronics Co | Bloomsbury Publishing vs. Guaranty Trust Holding |
| Liontrust Asset vs. Zoom Video Communications | Liontrust Asset vs. Kaufman Et Broad | Liontrust Asset vs. Universal Display Corp | Liontrust Asset vs. mobilezone holding AG |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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