Correlation Between LBG Media and Abrdn Property
Can any of the company-specific risk be diversified away by investing in both LBG Media and Abrdn Property 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 LBG Media and Abrdn Property into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LBG Media PLC and abrdn Property Income, you can compare the effects of market volatilities on LBG Media and Abrdn Property 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 LBG Media with a short position of Abrdn Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of LBG Media and Abrdn Property.
Diversification Opportunities for LBG Media and Abrdn Property
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between LBG and Abrdn is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding LBG Media PLC and abrdn Property Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on abrdn Property Income and LBG Media 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 LBG Media PLC are associated (or correlated) with Abrdn Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of abrdn Property Income has no effect on the direction of LBG Media i.e., LBG Media and Abrdn Property go up and down completely randomly.
Pair Corralation between LBG Media and Abrdn Property
Assuming the 90 days trading horizon LBG Media PLC is expected to under-perform the Abrdn Property. But the stock apears to be less risky and, when comparing its historical volatility, LBG Media PLC is 1.1 times less risky than Abrdn Property. The stock trades about -0.22 of its potential returns per unit of risk. The abrdn Property Income is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 680.00 in abrdn Property Income on October 29, 2024 and sell it today you would lose (10.00) from holding abrdn Property Income or give up 1.47% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
LBG Media PLC vs. abrdn Property Income
Performance |
| Timeline |
| LBG Media PLC |
| abrdn Property Income |
LBG Media and Abrdn Property Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LBG Media and Abrdn Property
The main advantage of trading using opposite LBG Media and Abrdn Property positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LBG Media position performs unexpectedly, Abrdn Property 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 Abrdn Property will offset losses from the drop in Abrdn Property's long position.| LBG Media vs. Chocoladefabriken Lindt Spruengli | LBG Media vs. National Atomic Co | LBG Media vs. OTP Bank Nyrt | LBG Media vs. Samsung Electronics Co |
| Abrdn Property vs. Gaming Realms plc | Abrdn Property vs. Roper Technologies | Abrdn Property vs. Sovereign Metals | Abrdn Property vs. Symphony Environmental Technologies |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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