Correlation Between Lendlease and Materialise
Can any of the company-specific risk be diversified away by investing in both Lendlease and Materialise 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 Materialise into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lendlease Group and Materialise NV, you can compare the effects of market volatilities on Lendlease and Materialise 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 Materialise. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lendlease and Materialise.
Diversification Opportunities for Lendlease and Materialise
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Lendlease and Materialise is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Lendlease Group and Materialise NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Materialise NV 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 Materialise. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Materialise NV has no effect on the direction of Lendlease i.e., Lendlease and Materialise go up and down completely randomly.
Pair Corralation between Lendlease and Materialise
Assuming the 90 days trading horizon Lendlease Group is expected to generate 0.57 times more return on investment than Materialise. However, Lendlease Group is 1.75 times less risky than Materialise. It trades about 0.0 of its potential returns per unit of risk. Materialise NV is currently generating about -0.01 per unit of risk. If you would invest 417.00 in Lendlease Group on November 28, 2024 and sell it today you would lose (51.00) from holding Lendlease Group or give up 12.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lendlease Group vs. Materialise NV
Performance |
| Timeline |
| Lendlease Group |
| Materialise NV |
Lendlease and Materialise Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lendlease and Materialise
The main advantage of trading using opposite Lendlease and Materialise positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lendlease position performs unexpectedly, Materialise 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 Materialise will offset losses from the drop in Materialise's long position.| Lendlease vs. Sunstone Hotel Investors | Lendlease vs. Meli Hotels International | Lendlease vs. DALATA HOTEL | Lendlease vs. GRIFFIN MINING LTD |
| Materialise vs. Semiconductor Manufacturing International | Materialise vs. SCANSOURCE | Materialise vs. Thai Beverage Public | Materialise vs. China Resources Beer |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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