Correlation Between ÜSTRA Hannoversche and Lions Gate
Can any of the company-specific risk be diversified away by investing in both ÜSTRA Hannoversche and Lions Gate 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 ÜSTRA Hannoversche and Lions Gate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between STRA Hannoversche Verkehrsbetriebe and Lions Gate Entertainment, you can compare the effects of market volatilities on ÜSTRA Hannoversche and Lions Gate 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 ÜSTRA Hannoversche with a short position of Lions Gate. Check out your portfolio center. Please also check ongoing floating volatility patterns of ÜSTRA Hannoversche and Lions Gate.
Diversification Opportunities for ÜSTRA Hannoversche and Lions Gate
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ÜSTRA and Lions is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding STRA Hannoversche Verkehrsbetr and Lions Gate Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lions Gate Entertainment and ÜSTRA Hannoversche 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 STRA Hannoversche Verkehrsbetriebe are associated (or correlated) with Lions Gate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lions Gate Entertainment has no effect on the direction of ÜSTRA Hannoversche i.e., ÜSTRA Hannoversche and Lions Gate go up and down completely randomly.
Pair Corralation between ÜSTRA Hannoversche and Lions Gate
Assuming the 90 days horizon STRA Hannoversche Verkehrsbetriebe is expected to under-perform the Lions Gate. In addition to that, ÜSTRA Hannoversche is 1.13 times more volatile than Lions Gate Entertainment. It trades about -0.02 of its total potential returns per unit of risk. Lions Gate Entertainment is currently generating about -0.01 per unit of volatility. If you would invest 830.00 in Lions Gate Entertainment on September 2, 2024 and sell it today you would lose (135.00) from holding Lions Gate Entertainment or give up 16.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
STRA Hannoversche Verkehrsbetr vs. Lions Gate Entertainment
Performance |
| Timeline |
| ÜSTRA Hannoversche |
| Lions Gate Entertainment |
ÜSTRA Hannoversche and Lions Gate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ÜSTRA Hannoversche and Lions Gate
The main advantage of trading using opposite ÜSTRA Hannoversche and Lions Gate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ÜSTRA Hannoversche position performs unexpectedly, Lions Gate 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 Lions Gate will offset losses from the drop in Lions Gate's long position.| ÜSTRA Hannoversche vs. SCANDMEDICAL SOLDK 040 | ÜSTRA Hannoversche vs. MGIC INVESTMENT | ÜSTRA Hannoversche vs. HK Electric Investments | ÜSTRA Hannoversche vs. MEDICAL FACILITIES NEW |
| Lions Gate vs. Wizz Air Holdings | Lions Gate vs. DELTA AIR LINES | Lions Gate vs. FORWARD AIR P | Lions Gate vs. ALTAIR RES INC |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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