Correlation Between PT Steel and Lendlease
Can any of the company-specific risk be diversified away by investing in both PT Steel and Lendlease 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 PT Steel and Lendlease into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Steel Pipe and Lendlease Group, you can compare the effects of market volatilities on PT Steel and Lendlease 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 PT Steel with a short position of Lendlease. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Steel and Lendlease.
Diversification Opportunities for PT Steel and Lendlease
Very weak diversification
The 3 months correlation between S08 and Lendlease is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding PT Steel Pipe and Lendlease Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lendlease Group and PT Steel 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 PT Steel Pipe are associated (or correlated) with Lendlease. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lendlease Group has no effect on the direction of PT Steel i.e., PT Steel and Lendlease go up and down completely randomly.
Pair Corralation between PT Steel and Lendlease
Assuming the 90 days horizon PT Steel Pipe is expected to generate 7.51 times more return on investment than Lendlease. However, PT Steel is 7.51 times more volatile than Lendlease Group. It trades about 0.07 of its potential returns per unit of risk. Lendlease Group is currently generating about 0.16 per unit of risk. If you would invest 1.10 in PT Steel Pipe on October 20, 2024 and sell it today you would earn a total of 0.05 from holding PT Steel Pipe or generate 4.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Steel Pipe vs. Lendlease Group
Performance |
| Timeline |
| PT Steel Pipe |
| Lendlease Group |
PT Steel and Lendlease Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Steel and Lendlease
The main advantage of trading using opposite PT Steel and Lendlease positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Steel position performs unexpectedly, Lendlease 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 Lendlease will offset losses from the drop in Lendlease's long position.| PT Steel vs. ON SEMICONDUCTOR | PT Steel vs. National Beverage Corp | PT Steel vs. INTER CARS SA | PT Steel vs. Fevertree Drinks PLC |
| Lendlease vs. Westinghouse Air Brake | Lendlease vs. Wizz Air Holdings | Lendlease vs. GRENKELEASING Dusseldorf | Lendlease vs. WIZZ AIR HLDGUNSPADR4 |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
Other Complementary Tools
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. |