Correlation Between Hansa Investment and Liontrust Asset
Can any of the company-specific risk be diversified away by investing in both Hansa Investment 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 Hansa Investment and Liontrust Asset into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hansa Investment and Liontrust Asset Management, you can compare the effects of market volatilities on Hansa Investment 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 Hansa Investment with a short position of Liontrust Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hansa Investment and Liontrust Asset.
Diversification Opportunities for Hansa Investment and Liontrust Asset
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hansa and Liontrust is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Hansa Investment 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 Hansa Investment 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 Hansa Investment 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 Hansa Investment i.e., Hansa Investment and Liontrust Asset go up and down completely randomly.
Pair Corralation between Hansa Investment and Liontrust Asset
Assuming the 90 days trading horizon Hansa Investment is expected to generate 0.72 times more return on investment than Liontrust Asset. However, Hansa Investment is 1.38 times less risky than Liontrust Asset. It trades about 0.04 of its potential returns per unit of risk. Liontrust Asset Management is currently generating about -0.04 per unit of risk. If you would invest 16,190 in Hansa Investment on January 24, 2025 and sell it today you would earn a total of 5,730 from holding Hansa Investment or generate 35.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hansa Investment vs. Liontrust Asset Management
Performance |
| Timeline |
| Hansa Investment |
| Liontrust Asset Mana |
Hansa Investment and Liontrust Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hansa Investment and Liontrust Asset
The main advantage of trading using opposite Hansa Investment and Liontrust Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hansa Investment 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.| Hansa Investment vs. Liechtensteinische Landesbank AG | Hansa Investment vs. Alliance Data Systems | Hansa Investment vs. Sydbank | Hansa Investment vs. Berner Kantonalbank AG |
| Liontrust Asset vs. JD Sports Fashion | Liontrust Asset vs. Neo Energy Metals | Liontrust Asset vs. AMG Advanced Metallurgical | Liontrust Asset vs. Gaztransport et Technigaz |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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