Correlation Between Truscott Mining and Lendlease
Can any of the company-specific risk be diversified away by investing in both Truscott Mining 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 Truscott Mining and Lendlease into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Truscott Mining Corp and Lendlease Group, you can compare the effects of market volatilities on Truscott Mining 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 Truscott Mining with a short position of Lendlease. Check out your portfolio center. Please also check ongoing floating volatility patterns of Truscott Mining and Lendlease.
Diversification Opportunities for Truscott Mining and Lendlease
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Truscott and Lendlease is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Truscott Mining Corp and Lendlease Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lendlease Group and Truscott Mining 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 Truscott Mining Corp 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 Truscott Mining i.e., Truscott Mining and Lendlease go up and down completely randomly.
Pair Corralation between Truscott Mining and Lendlease
Assuming the 90 days trading horizon Truscott Mining is expected to generate 5.73 times less return on investment than Lendlease. In addition to that, Truscott Mining is 4.54 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 0.18 per unit of volatility. If you would invest 678.00 in Lendlease Group on September 1, 2024 and sell it today you would earn a total of 38.00 from holding Lendlease Group or generate 5.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Truscott Mining Corp vs. Lendlease Group
Performance |
| Timeline |
| Truscott Mining Corp |
| Lendlease Group |
Truscott Mining and Lendlease Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Truscott Mining and Lendlease
The main advantage of trading using opposite Truscott Mining and Lendlease positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Truscott Mining 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.| Truscott Mining vs. Northern Star Resources | Truscott Mining vs. Evolution Mining | Truscott Mining vs. Bluescope Steel | Truscott Mining vs. Sandfire Resources NL |
| Lendlease vs. Centaurus Metals | Lendlease vs. Truscott Mining Corp | Lendlease vs. Alto Metals | Lendlease vs. Actinogen Medical |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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