Correlation Between Lendinvest PLC and Hargreaves Lansdown
Can any of the company-specific risk be diversified away by investing in both Lendinvest PLC and Hargreaves Lansdown 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 Hargreaves Lansdown into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lendinvest PLC and Hargreaves Lansdown plc, you can compare the effects of market volatilities on Lendinvest PLC and Hargreaves Lansdown 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 Hargreaves Lansdown. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lendinvest PLC and Hargreaves Lansdown.
Diversification Opportunities for Lendinvest PLC and Hargreaves Lansdown
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Lendinvest and Hargreaves is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Lendinvest PLC and Hargreaves Lansdown plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hargreaves Lansdown plc 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 Hargreaves Lansdown. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hargreaves Lansdown plc has no effect on the direction of Lendinvest PLC i.e., Lendinvest PLC and Hargreaves Lansdown go up and down completely randomly.
Pair Corralation between Lendinvest PLC and Hargreaves Lansdown
Assuming the 90 days trading horizon Lendinvest PLC is expected to under-perform the Hargreaves Lansdown. But the stock apears to be less risky and, when comparing its historical volatility, Lendinvest PLC is 1.06 times less risky than Hargreaves Lansdown. The stock trades about -0.02 of its potential returns per unit of risk. The Hargreaves Lansdown plc is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 71,549 in Hargreaves Lansdown plc on September 3, 2024 and sell it today you would earn a total of 37,701 from holding Hargreaves Lansdown plc or generate 52.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lendinvest PLC vs. Hargreaves Lansdown plc
Performance |
| Timeline |
| Lendinvest PLC |
| Hargreaves Lansdown plc |
Lendinvest PLC and Hargreaves Lansdown Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lendinvest PLC and Hargreaves Lansdown
The main advantage of trading using opposite Lendinvest PLC and Hargreaves Lansdown positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lendinvest PLC position performs unexpectedly, Hargreaves Lansdown 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 Hargreaves Lansdown will offset losses from the drop in Hargreaves Lansdown's long position.| Lendinvest PLC vs. SupplyMe Capital PLC | Lendinvest PLC vs. 88 Energy | Lendinvest PLC vs. Vodafone Group PLC | Lendinvest PLC vs. Vodafone Group PLC |
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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 CEOs Directory module to screen CEOs from public companies around the world.
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