Correlation Between Super Retail and Lendlease
Can any of the company-specific risk be diversified away by investing in both Super Retail 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 Super Retail and Lendlease into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Super Retail Group and Lendlease Group, you can compare the effects of market volatilities on Super Retail 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 Super Retail with a short position of Lendlease. Check out your portfolio center. Please also check ongoing floating volatility patterns of Super Retail and Lendlease.
Diversification Opportunities for Super Retail and Lendlease
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Super and Lendlease is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Super Retail Group and Lendlease Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lendlease Group and Super Retail 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 Super Retail Group 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 Super Retail i.e., Super Retail and Lendlease go up and down completely randomly.
Pair Corralation between Super Retail and Lendlease
Assuming the 90 days trading horizon Super Retail Group is expected to under-perform the Lendlease. In addition to that, Super Retail is 1.09 times more volatile than Lendlease Group. It trades about -0.01 of its total potential returns per unit of risk. Lendlease Group is currently generating about 0.04 per unit of volatility. If you would invest 602.00 in Lendlease Group on August 25, 2024 and sell it today you would earn a total of 63.00 from holding Lendlease Group or generate 10.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Super Retail Group vs. Lendlease Group
Performance |
| Timeline |
| Super Retail Group |
| Lendlease Group |
Super Retail and Lendlease Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Super Retail and Lendlease
The main advantage of trading using opposite Super Retail and Lendlease positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Super Retail 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.| Super Retail vs. REGAL ASIAN INVESTMENTS | Super Retail vs. Qbe Insurance Group | Super Retail vs. Wt Financial Group | Super Retail vs. Kkr Credit Income |
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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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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