Correlation Between Lendlease Global and Herc Holdings
Can any of the company-specific risk be diversified away by investing in both Lendlease Global and Herc Holdings 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 Global and Herc Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lendlease Global Commercial and Herc Holdings, you can compare the effects of market volatilities on Lendlease Global and Herc Holdings 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 Global with a short position of Herc Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lendlease Global and Herc Holdings.
Diversification Opportunities for Lendlease Global and Herc Holdings
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Lendlease and Herc is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Lendlease Global Commercial and Herc Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Herc Holdings and Lendlease Global 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 Global Commercial are associated (or correlated) with Herc Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Herc Holdings has no effect on the direction of Lendlease Global i.e., Lendlease Global and Herc Holdings go up and down completely randomly.
Pair Corralation between Lendlease Global and Herc Holdings
Assuming the 90 days horizon Lendlease Global is expected to generate 10.49 times less return on investment than Herc Holdings. But when comparing it to its historical volatility, Lendlease Global Commercial is 8.45 times less risky than Herc Holdings. It trades about 0.08 of its potential returns per unit of risk. Herc Holdings is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 11,703 in Herc Holdings on August 24, 2024 and sell it today you would earn a total of 10,586 from holding Herc Holdings or generate 90.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Lendlease Global Commercial vs. Herc Holdings
Performance |
| Timeline |
| Lendlease Global Com |
| Herc Holdings |
Lendlease Global and Herc Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lendlease Global and Herc Holdings
The main advantage of trading using opposite Lendlease Global and Herc Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lendlease Global position performs unexpectedly, Herc Holdings 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 Herc Holdings will offset losses from the drop in Herc Holdings' long position.| Lendlease Global vs. Legacy Education | Lendlease Global vs. NVIDIA | Lendlease Global vs. Apple Inc | Lendlease Global vs. Microsoft |
| Herc Holdings vs. McGrath RentCorp | Herc Holdings vs. Alta Equipment Group | Herc Holdings vs. Custom Truck One | Herc Holdings vs. GATX Corporation |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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