Correlation Between LPP SA and Asseco South
Can any of the company-specific risk be diversified away by investing in both LPP SA and Asseco South 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 LPP SA and Asseco South into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LPP SA and Asseco South Eastern, you can compare the effects of market volatilities on LPP SA and Asseco South 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 LPP SA with a short position of Asseco South. Check out your portfolio center. Please also check ongoing floating volatility patterns of LPP SA and Asseco South.
Diversification Opportunities for LPP SA and Asseco South
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between LPP and Asseco is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding LPP SA and Asseco South Eastern in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asseco South Eastern and LPP SA 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 LPP SA are associated (or correlated) with Asseco South. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asseco South Eastern has no effect on the direction of LPP SA i.e., LPP SA and Asseco South go up and down completely randomly.
Pair Corralation between LPP SA and Asseco South
Assuming the 90 days trading horizon LPP SA is expected to generate 1.84 times more return on investment than Asseco South. However, LPP SA is 1.84 times more volatile than Asseco South Eastern. It trades about 0.06 of its potential returns per unit of risk. Asseco South Eastern is currently generating about 0.04 per unit of risk. If you would invest 1,470,164 in LPP SA on August 26, 2024 and sell it today you would earn a total of 66,836 from holding LPP SA or generate 4.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
LPP SA vs. Asseco South Eastern
Performance |
| Timeline |
| LPP SA |
| Asseco South Eastern |
LPP SA and Asseco South Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LPP SA and Asseco South
The main advantage of trading using opposite LPP SA and Asseco South positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LPP SA position performs unexpectedly, Asseco South 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 Asseco South will offset losses from the drop in Asseco South's long position.| LPP SA vs. Esotiq Henderson SA | LPP SA vs. Asseco Business Solutions | LPP SA vs. Detalion Games SA | LPP SA vs. Asseco South Eastern |
| Asseco South vs. Echo Investment SA | Asseco South vs. Mlk Foods Public | Asseco South vs. Quantum Software SA | Asseco South vs. Cloud Technologies SA |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
Other Complementary Tools
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios |