Correlation Between Lendlease and Wayside Technology
Can any of the company-specific risk be diversified away by investing in both Lendlease and Wayside Technology 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 Wayside Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lendlease Group and Wayside Technology Group, you can compare the effects of market volatilities on Lendlease and Wayside Technology 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 Wayside Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lendlease and Wayside Technology.
Diversification Opportunities for Lendlease and Wayside Technology
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Lendlease and Wayside is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Lendlease Group and Wayside Technology Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wayside Technology 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 Wayside Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wayside Technology has no effect on the direction of Lendlease i.e., Lendlease and Wayside Technology go up and down completely randomly.
Pair Corralation between Lendlease and Wayside Technology
Assuming the 90 days trading horizon Lendlease Group is expected to under-perform the Wayside Technology. But the stock apears to be less risky and, when comparing its historical volatility, Lendlease Group is 1.6 times less risky than Wayside Technology. The stock trades about -0.02 of its potential returns per unit of risk. The Wayside Technology Group is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 5,054 in Wayside Technology Group on October 16, 2024 and sell it today you would earn a total of 6,946 from holding Wayside Technology Group or generate 137.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.63% |
| Values | Daily Returns |
Lendlease Group vs. Wayside Technology Group
Performance |
| Timeline |
| Lendlease Group |
| Wayside Technology |
Lendlease and Wayside Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lendlease and Wayside Technology
The main advantage of trading using opposite Lendlease and Wayside Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lendlease position performs unexpectedly, Wayside Technology 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 Wayside Technology will offset losses from the drop in Wayside Technology's long position.| Lendlease vs. FIH MOBILE | Lendlease vs. T Mobile | Lendlease vs. GEELY AUTOMOBILE | Lendlease vs. Casio Computer CoLtd |
| Wayside Technology vs. Liberty Broadband | Wayside Technology vs. AGF Management Limited | Wayside Technology vs. PICKN PAY STORES | Wayside Technology vs. National Retail Properties |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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