Correlation Between Lendlease and Dave Busters
Can any of the company-specific risk be diversified away by investing in both Lendlease and Dave Busters 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 Dave Busters into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lendlease Group and Dave Busters Entertainment, you can compare the effects of market volatilities on Lendlease and Dave Busters 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 Dave Busters. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lendlease and Dave Busters.
Diversification Opportunities for Lendlease and Dave Busters
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lendlease and Dave is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Lendlease Group and Dave Busters Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dave Busters Enterta 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 Dave Busters. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dave Busters Enterta has no effect on the direction of Lendlease i.e., Lendlease and Dave Busters go up and down completely randomly.
Pair Corralation between Lendlease and Dave Busters
Assuming the 90 days trading horizon Lendlease Group is expected to generate 0.68 times more return on investment than Dave Busters. However, Lendlease Group is 1.47 times less risky than Dave Busters. It trades about 0.03 of its potential returns per unit of risk. Dave Busters Entertainment is currently generating about 0.0 per unit of risk. If you would invest 398.00 in Lendlease Group on September 3, 2024 and sell it today you would earn a total of 39.00 from holding Lendlease Group or generate 9.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lendlease Group vs. Dave Busters Entertainment
Performance |
| Timeline |
| Lendlease Group |
| Dave Busters Enterta |
Lendlease and Dave Busters Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lendlease and Dave Busters
The main advantage of trading using opposite Lendlease and Dave Busters positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lendlease position performs unexpectedly, Dave Busters 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 Dave Busters will offset losses from the drop in Dave Busters' long position.| Lendlease vs. KB HOME | Lendlease vs. Flutter Entertainment PLC | Lendlease vs. GigaMedia | Lendlease vs. PT Global Mediacom |
| Dave Busters vs. McDonalds | Dave Busters vs. Chipotle Mexican Grill | Dave Busters vs. Superior Plus Corp | Dave Busters vs. NMI Holdings |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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