Correlation Between LYFT and Land Securities
Can any of the company-specific risk be diversified away by investing in both LYFT and Land Securities 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 LYFT and Land Securities into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LYFT Inc and Land Securities Group, you can compare the effects of market volatilities on LYFT and Land Securities 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 LYFT with a short position of Land Securities. Check out your portfolio center. Please also check ongoing floating volatility patterns of LYFT and Land Securities.
Diversification Opportunities for LYFT and Land Securities
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between LYFT and Land is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding LYFT Inc and Land Securities Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Land Securities Group and LYFT 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 LYFT Inc are associated (or correlated) with Land Securities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Land Securities Group has no effect on the direction of LYFT i.e., LYFT and Land Securities go up and down completely randomly.
Pair Corralation between LYFT and Land Securities
Given the investment horizon of 90 days LYFT Inc is expected to generate 2.46 times more return on investment than Land Securities. However, LYFT is 2.46 times more volatile than Land Securities Group. It trades about 0.19 of its potential returns per unit of risk. Land Securities Group is currently generating about -0.16 per unit of risk. If you would invest 1,391 in LYFT Inc on August 30, 2024 and sell it today you would earn a total of 327.00 from holding LYFT Inc or generate 23.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
LYFT Inc vs. Land Securities Group
Performance |
| Timeline |
| LYFT Inc |
| Land Securities Group |
LYFT and Land Securities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LYFT and Land Securities
The main advantage of trading using opposite LYFT and Land Securities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LYFT position performs unexpectedly, Land Securities 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 Land Securities will offset losses from the drop in Land Securities' long position.The idea behind LYFT Inc and Land Securities Group pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Land Securities vs. Land Securities Group | Land Securities vs. British Land | Land Securities vs. British Land | Land Securities vs. Taylor Wimpey PLC |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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