Correlation Between Lendinvest PLC and Ion Beam
Can any of the company-specific risk be diversified away by investing in both Lendinvest PLC and Ion Beam 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 Lendinvest PLC and Ion Beam into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lendinvest PLC and Ion Beam Applications, you can compare the effects of market volatilities on Lendinvest PLC and Ion Beam 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 Lendinvest PLC with a short position of Ion Beam. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lendinvest PLC and Ion Beam.
Diversification Opportunities for Lendinvest PLC and Ion Beam
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Lendinvest and Ion is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Lendinvest PLC and Ion Beam Applications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ion Beam Applications and Lendinvest PLC 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 Lendinvest PLC are associated (or correlated) with Ion Beam. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ion Beam Applications has no effect on the direction of Lendinvest PLC i.e., Lendinvest PLC and Ion Beam go up and down completely randomly.
Pair Corralation between Lendinvest PLC and Ion Beam
Assuming the 90 days trading horizon Lendinvest PLC is expected to under-perform the Ion Beam. But the stock apears to be less risky and, when comparing its historical volatility, Lendinvest PLC is 2.23 times less risky than Ion Beam. The stock trades about -0.06 of its potential returns per unit of risk. The Ion Beam Applications is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,321 in Ion Beam Applications on August 29, 2024 and sell it today you would earn a total of 22.00 from holding Ion Beam Applications or generate 1.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 97.67% |
| Values | Daily Returns |
Lendinvest PLC vs. Ion Beam Applications
Performance |
| Timeline |
| Lendinvest PLC |
| Ion Beam Applications |
Lendinvest PLC and Ion Beam Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lendinvest PLC and Ion Beam
The main advantage of trading using opposite Lendinvest PLC and Ion Beam positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lendinvest PLC position performs unexpectedly, Ion Beam 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 Ion Beam will offset losses from the drop in Ion Beam's long position.| Lendinvest PLC vs. Toyota Motor Corp | Lendinvest PLC vs. Neometals | Lendinvest PLC vs. Coor Service Management | Lendinvest PLC vs. Albion Technology General |
| Ion Beam vs. Lendinvest PLC | Ion Beam vs. Neometals | Ion Beam vs. Coor Service Management | Ion Beam vs. Albion Technology General |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |