Correlation Between LH Shopping and WHA Premium
Can any of the company-specific risk be diversified away by investing in both LH Shopping and WHA Premium 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 LH Shopping and WHA Premium into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LH Shopping Centers and WHA Premium Growth, you can compare the effects of market volatilities on LH Shopping and WHA Premium 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 LH Shopping with a short position of WHA Premium. Check out your portfolio center. Please also check ongoing floating volatility patterns of LH Shopping and WHA Premium.
Diversification Opportunities for LH Shopping and WHA Premium
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between LHSC and WHA is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding LH Shopping Centers and WHA Premium Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WHA Premium Growth and LH Shopping 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 LH Shopping Centers are associated (or correlated) with WHA Premium. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WHA Premium Growth has no effect on the direction of LH Shopping i.e., LH Shopping and WHA Premium go up and down completely randomly.
Pair Corralation between LH Shopping and WHA Premium
Assuming the 90 days trading horizon LH Shopping Centers is expected to generate 0.74 times more return on investment than WHA Premium. However, LH Shopping Centers is 1.35 times less risky than WHA Premium. It trades about 0.09 of its potential returns per unit of risk. WHA Premium Growth is currently generating about -0.07 per unit of risk. If you would invest 1,093 in LH Shopping Centers on August 27, 2024 and sell it today you would earn a total of 17.00 from holding LH Shopping Centers or generate 1.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
LH Shopping Centers vs. WHA Premium Growth
Performance |
| Timeline |
| LH Shopping Centers |
| WHA Premium Growth |
LH Shopping and WHA Premium Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LH Shopping and WHA Premium
The main advantage of trading using opposite LH Shopping and WHA Premium positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LH Shopping position performs unexpectedly, WHA Premium 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 WHA Premium will offset losses from the drop in WHA Premium's long position.| LH Shopping vs. LH Hotel Leasehold | LH Shopping vs. Impact Growth REIT | LH Shopping vs. Quality Houses Property | LH Shopping vs. CPN Retail Growth |
| WHA Premium vs. WHA Public | WHA Premium vs. CPN Retail Growth | WHA Premium vs. Impact Growth REIT | WHA Premium vs. Digital Telecommunications Infrastructure |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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