Correlation Between Lundin Energy and PEAK Old
Can any of the company-specific risk be diversified away by investing in both Lundin Energy and PEAK Old 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 Lundin Energy and PEAK Old into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lundin Energy AB and PEAK Old, you can compare the effects of market volatilities on Lundin Energy and PEAK Old 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 Lundin Energy with a short position of PEAK Old. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lundin Energy and PEAK Old.
Diversification Opportunities for Lundin Energy and PEAK Old
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Lundin and PEAK is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Lundin Energy AB and PEAK Old in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PEAK Old and Lundin Energy 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 Lundin Energy AB are associated (or correlated) with PEAK Old. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PEAK Old has no effect on the direction of Lundin Energy i.e., Lundin Energy and PEAK Old go up and down completely randomly.
Pair Corralation between Lundin Energy and PEAK Old
If you would invest 2,212 in PEAK Old on August 28, 2024 and sell it today you would earn a total of 0.00 from holding PEAK Old or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
Lundin Energy AB vs. PEAK Old
Performance |
| Timeline |
| Lundin Energy AB |
| PEAK Old |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Lundin Energy and PEAK Old Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lundin Energy and PEAK Old
The main advantage of trading using opposite Lundin Energy and PEAK Old positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lundin Energy position performs unexpectedly, PEAK Old 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 PEAK Old will offset losses from the drop in PEAK Old's long position.| Lundin Energy vs. Renew Energy Global | Lundin Energy vs. Energy Vault Holdings | Lundin Energy vs. Fluence Energy | Lundin Energy vs. Advent Technologies Holdings |
| PEAK Old vs. Welltower | PEAK Old vs. Mid America Apartment Communities | PEAK Old vs. Regency Centers | PEAK Old vs. UDR Inc |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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