Correlation Between Lendinvest PLC and Batm Advanced
Can any of the company-specific risk be diversified away by investing in both Lendinvest PLC and Batm Advanced 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 Batm Advanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lendinvest PLC and Batm Advanced Communications, you can compare the effects of market volatilities on Lendinvest PLC and Batm Advanced 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 Batm Advanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lendinvest PLC and Batm Advanced.
Diversification Opportunities for Lendinvest PLC and Batm Advanced
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lendinvest and Batm is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Lendinvest PLC and Batm Advanced Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Batm Advanced Commun 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 Batm Advanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Batm Advanced Commun has no effect on the direction of Lendinvest PLC i.e., Lendinvest PLC and Batm Advanced go up and down completely randomly.
Pair Corralation between Lendinvest PLC and Batm Advanced
Assuming the 90 days trading horizon Lendinvest PLC is expected to under-perform the Batm Advanced. But the stock apears to be less risky and, when comparing its historical volatility, Lendinvest PLC is 1.87 times less risky than Batm Advanced. The stock trades about -0.02 of its potential returns per unit of risk. The Batm Advanced Communications is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 2,055 in Batm Advanced Communications on September 12, 2024 and sell it today you would lose (195.00) from holding Batm Advanced Communications or give up 9.49% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Lendinvest PLC vs. Batm Advanced Communications
Performance |
| Timeline |
| Lendinvest PLC |
| Batm Advanced Commun |
Lendinvest PLC and Batm Advanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lendinvest PLC and Batm Advanced
The main advantage of trading using opposite Lendinvest PLC and Batm Advanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lendinvest PLC position performs unexpectedly, Batm Advanced 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 Batm Advanced will offset losses from the drop in Batm Advanced's long position.| Lendinvest PLC vs. Metals Exploration Plc | Lendinvest PLC vs. Panther Metals PLC | Lendinvest PLC vs. Silvercorp Metals | Lendinvest PLC vs. Team Internet Group |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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