Correlation Between LBG Media and Invesco Physical
Can any of the company-specific risk be diversified away by investing in both LBG Media and Invesco Physical 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 Invesco Physical 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 Invesco Physical Silver, you can compare the effects of market volatilities on LBG Media and Invesco Physical 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 Invesco Physical. Check out your portfolio center. Please also check ongoing floating volatility patterns of LBG Media and Invesco Physical.
Diversification Opportunities for LBG Media and Invesco Physical
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between LBG and Invesco is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding LBG Media PLC and Invesco Physical Silver in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco Physical Silver 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 Invesco Physical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco Physical Silver has no effect on the direction of LBG Media i.e., LBG Media and Invesco Physical go up and down completely randomly.
Pair Corralation between LBG Media and Invesco Physical
Assuming the 90 days trading horizon LBG Media PLC is expected to generate 1.34 times more return on investment than Invesco Physical. However, LBG Media is 1.34 times more volatile than Invesco Physical Silver. It trades about 0.08 of its potential returns per unit of risk. Invesco Physical Silver is currently generating about 0.08 per unit of risk. If you would invest 8,340 in LBG Media PLC on November 7, 2024 and sell it today you would earn a total of 4,060 from holding LBG Media PLC or generate 48.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
LBG Media PLC vs. Invesco Physical Silver
Performance |
| Timeline |
| LBG Media PLC |
| Invesco Physical Silver |
LBG Media and Invesco Physical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LBG Media and Invesco Physical
The main advantage of trading using opposite LBG Media and Invesco Physical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LBG Media position performs unexpectedly, Invesco Physical 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 Invesco Physical will offset losses from the drop in Invesco Physical's long position.| LBG Media vs. Public Storage | LBG Media vs. Wyndham Hotels Resorts | LBG Media vs. Wizz Air Holdings | LBG Media vs. Delta Air Lines |
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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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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