Correlation Between Churchill Downs and Lendlease
Can any of the company-specific risk be diversified away by investing in both Churchill Downs 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 Churchill Downs and Lendlease into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Churchill Downs Incorporated and Lendlease Group, you can compare the effects of market volatilities on Churchill Downs 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 Churchill Downs with a short position of Lendlease. Check out your portfolio center. Please also check ongoing floating volatility patterns of Churchill Downs and Lendlease.
Diversification Opportunities for Churchill Downs and Lendlease
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Churchill and Lendlease is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Churchill Downs Incorporated and Lendlease Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lendlease Group and Churchill Downs 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 Churchill Downs Incorporated 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 Churchill Downs i.e., Churchill Downs and Lendlease go up and down completely randomly.
Pair Corralation between Churchill Downs and Lendlease
Assuming the 90 days trading horizon Churchill Downs is expected to generate 1.36 times less return on investment than Lendlease. In addition to that, Churchill Downs is 1.39 times more volatile than Lendlease Group. It trades about 0.13 of its total potential returns per unit of risk. Lendlease Group is currently generating about 0.24 per unit of volatility. If you would invest 406.00 in Lendlease Group on September 5, 2024 and sell it today you would earn a total of 31.00 from holding Lendlease Group or generate 7.64% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 95.65% |
Values | Daily Returns |
Churchill Downs Incorporated vs. Lendlease Group
Performance |
Timeline |
Churchill Downs |
Lendlease Group |
Churchill Downs and Lendlease Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Churchill Downs and Lendlease
The main advantage of trading using opposite Churchill Downs and Lendlease positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Churchill Downs 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.Churchill Downs vs. Lendlease Group | Churchill Downs vs. MUTUIONLINE | Churchill Downs vs. WisdomTree Investments | Churchill Downs vs. CarsalesCom |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |