Correlation Between Disney and LLOYDS
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By analyzing existing cross correlation between Walt Disney and LLOYDS BANKING GROUP, you can compare the effects of market volatilities on Disney and LLOYDS 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 Disney with a short position of LLOYDS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Disney and LLOYDS.
Diversification Opportunities for Disney and LLOYDS
Very good diversification
The 3 months correlation between Disney and LLOYDS is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Walt Disney 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 Disney 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 Walt Disney are associated (or correlated) with LLOYDS. 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 Disney i.e., Disney and LLOYDS go up and down completely randomly.
Pair Corralation between Disney and LLOYDS
Considering the 90-day investment horizon Walt Disney is expected to generate 0.97 times more return on investment than LLOYDS. However, Walt Disney is 1.03 times less risky than LLOYDS. It trades about 0.51 of its potential returns per unit of risk. LLOYDS BANKING GROUP is currently generating about -0.27 per unit of risk. If you would invest 9,620 in Walt Disney on September 1, 2024 and sell it today you would earn a total of 2,127 from holding Walt Disney or generate 22.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 66.67% |
| Values | Daily Returns |
Walt Disney vs. LLOYDS BANKING GROUP
Performance |
| Timeline |
| Walt Disney |
| LLOYDS BANKING GROUP |
Disney and LLOYDS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Disney and LLOYDS
The main advantage of trading using opposite Disney and LLOYDS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Disney position performs unexpectedly, LLOYDS 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 will offset losses from the drop in LLOYDS's long position.| Disney vs. ADTRAN Inc | Disney vs. Belden Inc | Disney vs. ADC Therapeutics SA | Disney vs. Comtech Telecommunications Corp |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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