Correlation Between Lendlease and PLAYTECH
Can any of the company-specific risk be diversified away by investing in both Lendlease and PLAYTECH 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 PLAYTECH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lendlease Group and PLAYTECH, you can compare the effects of market volatilities on Lendlease and PLAYTECH 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 PLAYTECH. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lendlease and PLAYTECH.
Diversification Opportunities for Lendlease and PLAYTECH
Very weak diversification
The 3 months correlation between Lendlease and PLAYTECH is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Lendlease Group and PLAYTECH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PLAYTECH 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 PLAYTECH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PLAYTECH has no effect on the direction of Lendlease i.e., Lendlease and PLAYTECH go up and down completely randomly.
Pair Corralation between Lendlease and PLAYTECH
Assuming the 90 days trading horizon Lendlease Group is expected to under-perform the PLAYTECH. But the stock apears to be less risky and, when comparing its historical volatility, Lendlease Group is 1.1 times less risky than PLAYTECH. The stock trades about -0.01 of its potential returns per unit of risk. The PLAYTECH is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 645.00 in PLAYTECH on November 6, 2024 and sell it today you would earn a total of 237.00 from holding PLAYTECH or generate 36.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lendlease Group vs. PLAYTECH
Performance |
| Timeline |
| Lendlease Group |
| PLAYTECH |
Lendlease and PLAYTECH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lendlease and PLAYTECH
The main advantage of trading using opposite Lendlease and PLAYTECH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lendlease position performs unexpectedly, PLAYTECH 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 PLAYTECH will offset losses from the drop in PLAYTECH's long position.| Lendlease vs. SILVER BULLET DATA | Lendlease vs. Wizz Air Holdings | Lendlease vs. SOGECLAIR SA INH | Lendlease vs. DICKER DATA LTD |
| PLAYTECH vs. PREMIER FOODS | PLAYTECH vs. Air Lease | PLAYTECH vs. FIRST SHIP LEASE | PLAYTECH vs. GWILLI FOOD |
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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