Correlation Between Mastercard and Lion Group
Can any of the company-specific risk be diversified away by investing in both Mastercard and Lion Group 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 Mastercard and Lion Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mastercard and Lion Group Holding, you can compare the effects of market volatilities on Mastercard and Lion Group 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 Mastercard with a short position of Lion Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mastercard and Lion Group.
Diversification Opportunities for Mastercard and Lion Group
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Mastercard and Lion is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Mastercard and Lion Group Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lion Group Holding and Mastercard 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 Mastercard are associated (or correlated) with Lion Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lion Group Holding has no effect on the direction of Mastercard i.e., Mastercard and Lion Group go up and down completely randomly.
Pair Corralation between Mastercard and Lion Group
Allowing for the 90-day total investment horizon Mastercard is expected to generate 0.15 times more return on investment than Lion Group. However, Mastercard is 6.55 times less risky than Lion Group. It trades about 0.13 of its potential returns per unit of risk. Lion Group Holding is currently generating about -0.01 per unit of risk. If you would invest 49,146 in Mastercard on September 12, 2024 and sell it today you would earn a total of 3,755 from holding Mastercard or generate 7.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mastercard vs. Lion Group Holding
Performance |
| Timeline |
| Mastercard |
| Lion Group Holding |
Mastercard and Lion Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mastercard and Lion Group
The main advantage of trading using opposite Mastercard and Lion Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mastercard position performs unexpectedly, Lion Group 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 Lion Group will offset losses from the drop in Lion Group's long position.| Mastercard vs. American Express | Mastercard vs. Capital One Financial | Mastercard vs. Upstart Holdings | Mastercard vs. Ally Financial |
| Lion Group vs. Top KingWin Ltd | Lion Group vs. Magic Empire Global | Lion Group vs. Netcapital | Lion Group vs. Mercurity Fintech Holding |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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