Correlation Between Lendlease and Ramsay Health
Can any of the company-specific risk be diversified away by investing in both Lendlease and Ramsay Health 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 Ramsay Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lendlease Group and Ramsay Health Care, you can compare the effects of market volatilities on Lendlease and Ramsay Health 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 Ramsay Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lendlease and Ramsay Health.
Diversification Opportunities for Lendlease and Ramsay Health
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Lendlease and Ramsay is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Lendlease Group and Ramsay Health Care in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ramsay Health Care 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 Ramsay Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ramsay Health Care has no effect on the direction of Lendlease i.e., Lendlease and Ramsay Health go up and down completely randomly.
Pair Corralation between Lendlease and Ramsay Health
Assuming the 90 days trading horizon Lendlease Group is expected to generate 0.84 times more return on investment than Ramsay Health. However, Lendlease Group is 1.19 times less risky than Ramsay Health. It trades about 0.25 of its potential returns per unit of risk. Ramsay Health Care is currently generating about 0.08 per unit of risk. If you would invest 406.00 in Lendlease Group on September 3, 2024 and sell it today you would earn a total of 32.00 from holding Lendlease Group or generate 7.88% 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. Ramsay Health Care
Performance |
| Timeline |
| Lendlease Group |
| Ramsay Health Care |
Lendlease and Ramsay Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lendlease and Ramsay Health
The main advantage of trading using opposite Lendlease and Ramsay Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lendlease position performs unexpectedly, Ramsay Health 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 Ramsay Health will offset losses from the drop in Ramsay Health's long position.| Lendlease vs. KB HOME | Lendlease vs. Flutter Entertainment PLC | Lendlease vs. GigaMedia | Lendlease vs. PT Global Mediacom |
| Ramsay Health vs. Superior Plus Corp | Ramsay Health vs. NMI Holdings | Ramsay Health vs. Origin Agritech | Ramsay Health vs. SIVERS SEMICONDUCTORS AB |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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