Correlation Between Lloyds Banking and Everyman Media
Can any of the company-specific risk be diversified away by investing in both Lloyds Banking and Everyman Media 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 Lloyds Banking and Everyman Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lloyds Banking Group and Everyman Media Group, you can compare the effects of market volatilities on Lloyds Banking and Everyman Media 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 Lloyds Banking with a short position of Everyman Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lloyds Banking and Everyman Media.
Diversification Opportunities for Lloyds Banking and Everyman Media
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lloyds and Everyman is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Lloyds Banking Group and Everyman Media Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Everyman Media Group and Lloyds Banking 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 Lloyds Banking Group are associated (or correlated) with Everyman Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Everyman Media Group has no effect on the direction of Lloyds Banking i.e., Lloyds Banking and Everyman Media go up and down completely randomly.
Pair Corralation between Lloyds Banking and Everyman Media
Assuming the 90 days trading horizon Lloyds Banking is expected to generate 15.24 times less return on investment than Everyman Media. But when comparing it to its historical volatility, Lloyds Banking Group is 1.18 times less risky than Everyman Media. It trades about 0.0 of its potential returns per unit of risk. Everyman Media Group is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 4,900 in Everyman Media Group on September 27, 2024 and sell it today you would earn a total of 350.00 from holding Everyman Media Group or generate 7.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lloyds Banking Group vs. Everyman Media Group
Performance |
| Timeline |
| Lloyds Banking Group |
| Everyman Media Group |
Lloyds Banking and Everyman Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lloyds Banking and Everyman Media
The main advantage of trading using opposite Lloyds Banking and Everyman Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lloyds Banking position performs unexpectedly, Everyman Media 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 Everyman Media will offset losses from the drop in Everyman Media's long position.| Lloyds Banking vs. Berkshire Hathaway | Lloyds Banking vs. Hyundai Motor | Lloyds Banking vs. Samsung Electronics Co | Lloyds Banking vs. Samsung Electronics Co |
| Everyman Media vs. SupplyMe Capital PLC | Everyman Media vs. Lloyds Banking Group | Everyman Media vs. Premier African Minerals | Everyman Media vs. SANTANDER UK 8 |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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