Correlation Between Impact Growth and LH Shopping
Can any of the company-specific risk be diversified away by investing in both Impact Growth and LH Shopping 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 Impact Growth and LH Shopping into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Impact Growth REIT and LH Shopping Centers, you can compare the effects of market volatilities on Impact Growth and LH Shopping 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 Impact Growth with a short position of LH Shopping. Check out your portfolio center. Please also check ongoing floating volatility patterns of Impact Growth and LH Shopping.
Diversification Opportunities for Impact Growth and LH Shopping
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Impact and LHSC is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Impact Growth REIT and LH Shopping Centers in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LH Shopping Centers and Impact Growth 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 Impact Growth REIT are associated (or correlated) with LH Shopping. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LH Shopping Centers has no effect on the direction of Impact Growth i.e., Impact Growth and LH Shopping go up and down completely randomly.
Pair Corralation between Impact Growth and LH Shopping
Assuming the 90 days trading horizon Impact Growth is expected to generate 9.22 times less return on investment than LH Shopping. But when comparing it to its historical volatility, Impact Growth REIT is 1.09 times less risky than LH Shopping. It trades about 0.01 of its potential returns per unit of risk. LH Shopping Centers is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 836.00 in LH Shopping Centers on August 31, 2024 and sell it today you would earn a total of 294.00 from holding LH Shopping Centers or generate 35.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Impact Growth REIT vs. LH Shopping Centers
Performance |
| Timeline |
| Impact Growth REIT |
| LH Shopping Centers |
Impact Growth and LH Shopping Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Impact Growth and LH Shopping
The main advantage of trading using opposite Impact Growth and LH Shopping positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Impact Growth position performs unexpectedly, LH Shopping 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 LH Shopping will offset losses from the drop in LH Shopping's long position.| Impact Growth vs. CPN Retail Growth | Impact Growth vs. WHA Premium Growth | Impact Growth vs. Golden Ventures Leasehold | Impact Growth vs. LH Shopping Centers |
| LH Shopping vs. LH Hotel Leasehold | LH Shopping vs. Impact Growth REIT | LH Shopping vs. Quality Houses Property | LH Shopping vs. CPN Retail Growth |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
Other Complementary Tools
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas |