Correlation Between Lendlease and Grand Canyon
Can any of the company-specific risk be diversified away by investing in both Lendlease and Grand Canyon 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 Grand Canyon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lendlease Group and Grand Canyon Education, you can compare the effects of market volatilities on Lendlease and Grand Canyon 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 Grand Canyon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lendlease and Grand Canyon.
Diversification Opportunities for Lendlease and Grand Canyon
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Lendlease and Grand is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Lendlease Group and Grand Canyon Education in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grand Canyon Education 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 Grand Canyon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grand Canyon Education has no effect on the direction of Lendlease i.e., Lendlease and Grand Canyon go up and down completely randomly.
Pair Corralation between Lendlease and Grand Canyon
Assuming the 90 days trading horizon Lendlease is expected to generate 2.31 times less return on investment than Grand Canyon. But when comparing it to its historical volatility, Lendlease Group is 1.73 times less risky than Grand Canyon. It trades about 0.09 of its potential returns per unit of risk. Grand Canyon Education is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 12,900 in Grand Canyon Education on September 3, 2024 and sell it today you would earn a total of 2,600 from holding Grand Canyon Education or generate 20.16% 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. Grand Canyon Education
Performance |
| Timeline |
| Lendlease Group |
| Grand Canyon Education |
Lendlease and Grand Canyon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lendlease and Grand Canyon
The main advantage of trading using opposite Lendlease and Grand Canyon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lendlease position performs unexpectedly, Grand Canyon 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 Grand Canyon will offset losses from the drop in Grand Canyon's long position.| Lendlease vs. KB HOME | Lendlease vs. Flutter Entertainment PLC | Lendlease vs. GigaMedia | Lendlease vs. PT Global Mediacom |
| Grand Canyon vs. Apple Inc | Grand Canyon vs. Apple Inc | Grand Canyon vs. Apple Inc | Grand Canyon vs. Apple Inc |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |