Correlation Between Fortress Income and Lesaka Technologies
Can any of the company-specific risk be diversified away by investing in both Fortress Income and Lesaka Technologies 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 Fortress Income and Lesaka Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fortress Income and Lesaka Technologies, you can compare the effects of market volatilities on Fortress Income and Lesaka Technologies 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 Fortress Income with a short position of Lesaka Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fortress Income and Lesaka Technologies.
Diversification Opportunities for Fortress Income and Lesaka Technologies
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Fortress and Lesaka is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Fortress Income and Lesaka Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lesaka Technologies and Fortress Income 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 Fortress Income are associated (or correlated) with Lesaka Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lesaka Technologies has no effect on the direction of Fortress Income i.e., Fortress Income and Lesaka Technologies go up and down completely randomly.
Pair Corralation between Fortress Income and Lesaka Technologies
Assuming the 90 days trading horizon Fortress Income is expected to generate 1.77 times more return on investment than Lesaka Technologies. However, Fortress Income is 1.77 times more volatile than Lesaka Technologies. It trades about 0.08 of its potential returns per unit of risk. Lesaka Technologies is currently generating about 0.05 per unit of risk. If you would invest 69,600 in Fortress Income on September 14, 2024 and sell it today you would earn a total of 130,400 from holding Fortress Income or generate 187.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fortress Income vs. Lesaka Technologies
Performance |
| Timeline |
| Fortress Income |
| Lesaka Technologies |
Fortress Income and Lesaka Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fortress Income and Lesaka Technologies
The main advantage of trading using opposite Fortress Income and Lesaka Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fortress Income position performs unexpectedly, Lesaka Technologies 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 Lesaka Technologies will offset losses from the drop in Lesaka Technologies' long position.| Fortress Income vs. Growthpoint Properties | Fortress Income vs. Redefine Properties | Fortress Income vs. Emira Property | Fortress Income vs. Dipula Income |
| Lesaka Technologies vs. MC Mining | Lesaka Technologies vs. RCL Foods | Lesaka Technologies vs. Bytes Technology | Lesaka Technologies vs. Trematon Capital Investments |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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