Correlation Between Scientific Games and Lendlease
Can any of the company-specific risk be diversified away by investing in both Scientific Games 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 Scientific Games and Lendlease into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Scientific Games and Lendlease Group, you can compare the effects of market volatilities on Scientific Games 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 Scientific Games with a short position of Lendlease. Check out your portfolio center. Please also check ongoing floating volatility patterns of Scientific Games and Lendlease.
Diversification Opportunities for Scientific Games and Lendlease
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Scientific and Lendlease is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Scientific Games and Lendlease Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lendlease Group and Scientific Games 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 Scientific Games 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 Scientific Games i.e., Scientific Games and Lendlease go up and down completely randomly.
Pair Corralation between Scientific Games and Lendlease
Assuming the 90 days horizon Scientific Games is expected to generate 1.2 times less return on investment than Lendlease. In addition to that, Scientific Games is 2.02 times more volatile than Lendlease Group. It trades about 0.12 of its total potential returns per unit of risk. Lendlease Group is currently generating about 0.29 per unit of volatility. If you would invest 400.00 in Lendlease Group on September 2, 2024 and sell it today you would earn a total of 38.00 from holding Lendlease Group or generate 9.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Scientific Games vs. Lendlease Group
Performance |
| Timeline |
| Scientific Games |
| Lendlease Group |
Scientific Games and Lendlease Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Scientific Games and Lendlease
The main advantage of trading using opposite Scientific Games and Lendlease positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Scientific Games 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.| Scientific Games vs. NIPPON STEEL SPADR | Scientific Games vs. Retail Estates NV | Scientific Games vs. CECO ENVIRONMENTAL | Scientific Games vs. ALGOMA STEEL GROUP |
| Lendlease vs. FARO Technologies | Lendlease vs. Cass Information Systems | Lendlease vs. Hyrican Informationssysteme Aktiengesellschaft | Lendlease vs. Automatic Data Processing |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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