Correlation Between Lloyds Banking and MGM Resorts
Can any of the company-specific risk be diversified away by investing in both Lloyds Banking and MGM Resorts 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 MGM Resorts 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 MGM Resorts International, you can compare the effects of market volatilities on Lloyds Banking and MGM Resorts 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 MGM Resorts. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lloyds Banking and MGM Resorts.
Diversification Opportunities for Lloyds Banking and MGM Resorts
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Lloyds and MGM is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Lloyds Banking Group and MGM Resorts International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MGM Resorts International 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 MGM Resorts. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MGM Resorts International has no effect on the direction of Lloyds Banking i.e., Lloyds Banking and MGM Resorts go up and down completely randomly.
Pair Corralation between Lloyds Banking and MGM Resorts
If you would invest 75,000 in MGM Resorts International on September 4, 2024 and sell it today you would earn a total of 2,900 from holding MGM Resorts International or generate 3.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Lloyds Banking Group vs. MGM Resorts International
Performance |
| Timeline |
| Lloyds Banking Group |
| MGM Resorts International |
Lloyds Banking and MGM Resorts Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lloyds Banking and MGM Resorts
The main advantage of trading using opposite Lloyds Banking and MGM Resorts positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lloyds Banking position performs unexpectedly, MGM Resorts 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 MGM Resorts will offset losses from the drop in MGM Resorts' long position.| Lloyds Banking vs. United States Steel | Lloyds Banking vs. First Republic Bank | Lloyds Banking vs. Ameriprise Financial | Lloyds Banking vs. DXC Technology |
| MGM Resorts vs. DXC Technology | MGM Resorts vs. Lloyds Banking Group | MGM Resorts vs. Verizon Communications | MGM Resorts vs. Taiwan Semiconductor Manufacturing |
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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