Correlation Between Lem Holding and LandisGyr Group
Can any of the company-specific risk be diversified away by investing in both Lem Holding and LandisGyr Group 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 Lem Holding and LandisGyr Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lem Holding SA and LandisGyr Group AG, you can compare the effects of market volatilities on Lem Holding and LandisGyr Group 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 Lem Holding with a short position of LandisGyr Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lem Holding and LandisGyr Group.
Diversification Opportunities for Lem Holding and LandisGyr Group
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lem and LandisGyr is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Lem Holding SA and LandisGyr Group AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LandisGyr Group AG and Lem Holding 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 Lem Holding SA are associated (or correlated) with LandisGyr Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LandisGyr Group AG has no effect on the direction of Lem Holding i.e., Lem Holding and LandisGyr Group go up and down completely randomly.
Pair Corralation between Lem Holding and LandisGyr Group
Assuming the 90 days trading horizon Lem Holding SA is expected to generate 0.42 times more return on investment than LandisGyr Group. However, Lem Holding SA is 2.41 times less risky than LandisGyr Group. It trades about 0.15 of its potential returns per unit of risk. LandisGyr Group AG is currently generating about -0.17 per unit of risk. If you would invest 84,600 in Lem Holding SA on November 27, 2024 and sell it today you would earn a total of 5,400 from holding Lem Holding SA or generate 6.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lem Holding SA vs. LandisGyr Group AG
Performance |
| Timeline |
| Lem Holding SA |
| LandisGyr Group AG |
Lem Holding and LandisGyr Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lem Holding and LandisGyr Group
The main advantage of trading using opposite Lem Holding and LandisGyr Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lem Holding position performs unexpectedly, LandisGyr Group 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 LandisGyr Group will offset losses from the drop in LandisGyr Group's long position.| Lem Holding vs. Inficon Holding | Lem Holding vs. Belimo Holding | Lem Holding vs. Interroll Holding AG | Lem Holding vs. Comet Holding AG |
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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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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