Correlation Between Ping An and Lexington Realty
Can any of the company-specific risk be diversified away by investing in both Ping An and Lexington Realty 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 Ping An and Lexington Realty into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ping An Insurance and Lexington Realty Trust, you can compare the effects of market volatilities on Ping An and Lexington Realty 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 Ping An with a short position of Lexington Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ping An and Lexington Realty.
Diversification Opportunities for Ping An and Lexington Realty
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ping and Lexington is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Ping An Insurance and Lexington Realty Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lexington Realty Trust and Ping An 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 Ping An Insurance are associated (or correlated) with Lexington Realty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lexington Realty Trust has no effect on the direction of Ping An i.e., Ping An and Lexington Realty go up and down completely randomly.
Pair Corralation between Ping An and Lexington Realty
Assuming the 90 days trading horizon Ping An Insurance is expected to generate 2.49 times more return on investment than Lexington Realty. However, Ping An is 2.49 times more volatile than Lexington Realty Trust. It trades about 0.08 of its potential returns per unit of risk. Lexington Realty Trust is currently generating about 0.0 per unit of risk. If you would invest 236.00 in Ping An Insurance on September 12, 2024 and sell it today you would earn a total of 345.00 from holding Ping An Insurance or generate 146.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.72% |
| Values | Daily Returns |
Ping An Insurance vs. Lexington Realty Trust
Performance |
| Timeline |
| Ping An Insurance |
| Lexington Realty Trust |
Ping An and Lexington Realty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ping An and Lexington Realty
The main advantage of trading using opposite Ping An and Lexington Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ping An position performs unexpectedly, Lexington Realty 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 Lexington Realty will offset losses from the drop in Lexington Realty's long position.| Ping An vs. Nippon Steel | Ping An vs. REVO INSURANCE SPA | Ping An vs. ALGOMA STEEL GROUP | Ping An vs. LEGACY IRON ORE |
| Lexington Realty vs. Insurance Australia Group | Lexington Realty vs. CDL INVESTMENT | Lexington Realty vs. Goosehead Insurance | Lexington Realty vs. Ping An Insurance |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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