Correlation Between NYSE Composite and Lakeland Financial
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Lakeland Financial 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 NYSE Composite and Lakeland Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Lakeland Financial, you can compare the effects of market volatilities on NYSE Composite and Lakeland Financial 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 NYSE Composite with a short position of Lakeland Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Lakeland Financial.
Diversification Opportunities for NYSE Composite and Lakeland Financial
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between NYSE and Lakeland is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Lakeland Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lakeland Financial and NYSE Composite 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 NYSE Composite are associated (or correlated) with Lakeland Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lakeland Financial has no effect on the direction of NYSE Composite i.e., NYSE Composite and Lakeland Financial go up and down completely randomly.
Pair Corralation between NYSE Composite and Lakeland Financial
Assuming the 90 days trading horizon NYSE Composite is expected to generate 4.0 times less return on investment than Lakeland Financial. But when comparing it to its historical volatility, NYSE Composite is 4.52 times less risky than Lakeland Financial. It trades about 0.24 of its potential returns per unit of risk. Lakeland Financial is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 6,676 in Lakeland Financial on August 28, 2024 and sell it today you would earn a total of 909.00 from holding Lakeland Financial or generate 13.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. Lakeland Financial
Performance |
| Timeline |
NYSE Composite and Lakeland Financial Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Lakeland Financial
Pair trading matchups for Lakeland Financial
Pair Trading with NYSE Composite and Lakeland Financial
The main advantage of trading using opposite NYSE Composite and Lakeland Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Lakeland Financial 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 Lakeland Financial will offset losses from the drop in Lakeland Financial's long position.| NYSE Composite vs. Hooker Furniture | NYSE Composite vs. Hudson Pacific Properties | NYSE Composite vs. Canlan Ice Sports | NYSE Composite vs. Boston Properties |
| Lakeland Financial vs. Home Bancorp | Lakeland Financial vs. Heritage Financial | Lakeland Financial vs. First Northwest Bancorp | Lakeland Financial vs. HomeTrust Bancshares |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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