Correlation Between Lesaka Technologies and CA Sales
Can any of the company-specific risk be diversified away by investing in both Lesaka Technologies and CA Sales 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 Lesaka Technologies and CA Sales into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lesaka Technologies and CA Sales Holdings, you can compare the effects of market volatilities on Lesaka Technologies and CA Sales 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 Lesaka Technologies with a short position of CA Sales. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lesaka Technologies and CA Sales.
Diversification Opportunities for Lesaka Technologies and CA Sales
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Lesaka and CAA is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Lesaka Technologies and CA Sales Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CA Sales Holdings and Lesaka Technologies 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 Lesaka Technologies are associated (or correlated) with CA Sales. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CA Sales Holdings has no effect on the direction of Lesaka Technologies i.e., Lesaka Technologies and CA Sales go up and down completely randomly.
Pair Corralation between Lesaka Technologies and CA Sales
Assuming the 90 days trading horizon Lesaka Technologies is expected to generate 1.54 times more return on investment than CA Sales. However, Lesaka Technologies is 1.54 times more volatile than CA Sales Holdings. It trades about 0.07 of its potential returns per unit of risk. CA Sales Holdings is currently generating about 0.05 per unit of risk. If you would invest 810,100 in Lesaka Technologies on August 28, 2024 and sell it today you would earn a total of 90,100 from holding Lesaka Technologies or generate 11.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lesaka Technologies vs. CA Sales Holdings
Performance |
| Timeline |
| Lesaka Technologies |
| CA Sales Holdings |
Lesaka Technologies and CA Sales Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lesaka Technologies and CA Sales
The main advantage of trading using opposite Lesaka Technologies and CA Sales positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lesaka Technologies position performs unexpectedly, CA Sales 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 CA Sales will offset losses from the drop in CA Sales' long position.| Lesaka Technologies vs. Centaur Bci Balanced | Lesaka Technologies vs. Growthpoint Properties | Lesaka Technologies vs. Bowler Metcalf | Lesaka Technologies vs. Shoprite Holdings |
| CA Sales vs. Sasol Ltd Bee | CA Sales vs. Growthpoint Properties | CA Sales vs. AfricaRhodium ETF | CA Sales vs. CoreShares Preference Share |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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