Correlation Between Lendlease and Finexia Financial
Can any of the company-specific risk be diversified away by investing in both Lendlease and Finexia Financial 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 Lendlease and Finexia Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lendlease Group and Finexia Financial Group, you can compare the effects of market volatilities on Lendlease and Finexia Financial 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 Lendlease with a short position of Finexia Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lendlease and Finexia Financial.
Diversification Opportunities for Lendlease and Finexia Financial
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Lendlease and Finexia is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Lendlease Group and Finexia Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Finexia Financial and Lendlease 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 Lendlease Group are associated (or correlated) with Finexia Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Finexia Financial has no effect on the direction of Lendlease i.e., Lendlease and Finexia Financial go up and down completely randomly.
Pair Corralation between Lendlease and Finexia Financial
Assuming the 90 days trading horizon Lendlease Group is expected to under-perform the Finexia Financial. But the stock apears to be less risky and, when comparing its historical volatility, Lendlease Group is 2.8 times less risky than Finexia Financial. The stock trades about -0.06 of its potential returns per unit of risk. The Finexia Financial Group is currently generating about 0.33 of returns per unit of risk over similar time horizon. If you would invest 26.00 in Finexia Financial Group on August 27, 2024 and sell it today you would earn a total of 6.00 from holding Finexia Financial Group or generate 23.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lendlease Group vs. Finexia Financial Group
Performance |
| Timeline |
| Lendlease Group |
| Finexia Financial |
Lendlease and Finexia Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lendlease and Finexia Financial
The main advantage of trading using opposite Lendlease and Finexia Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lendlease position performs unexpectedly, Finexia Financial 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 Finexia Financial will offset losses from the drop in Finexia Financial's long position.| Lendlease vs. Scentre Group | Lendlease vs. Vicinity Centres Re | Lendlease vs. Charter Hall Retail | Lendlease vs. Cromwell Property Group |
| Finexia Financial vs. Renascor Resources | Finexia Financial vs. Venus Metals | Finexia Financial vs. Havilah Resources | Finexia Financial vs. Asara Resources |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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