Correlation Between Universal Display and Lendlease
Can any of the company-specific risk be diversified away by investing in both Universal Display 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 Universal Display and Lendlease into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Universal Display and Lendlease Group, you can compare the effects of market volatilities on Universal Display 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 Universal Display with a short position of Lendlease. Check out your portfolio center. Please also check ongoing floating volatility patterns of Universal Display and Lendlease.
Diversification Opportunities for Universal Display and Lendlease
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Universal and Lendlease is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Universal Display and Lendlease Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lendlease Group and Universal Display 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 Universal Display 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 Universal Display i.e., Universal Display and Lendlease go up and down completely randomly.
Pair Corralation between Universal Display and Lendlease
Assuming the 90 days horizon Universal Display is expected to generate 129.4 times less return on investment than Lendlease. In addition to that, Universal Display is 1.04 times more volatile than Lendlease Group. It trades about 0.0 of its total potential returns per unit of risk. Lendlease Group is currently generating about 0.19 per unit of volatility. If you would invest 368.00 in Lendlease Group on October 24, 2024 and sell it today you would earn a total of 12.00 from holding Lendlease Group or generate 3.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Universal Display vs. Lendlease Group
Performance |
| Timeline |
| Universal Display |
| Lendlease Group |
Universal Display and Lendlease Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Universal Display and Lendlease
The main advantage of trading using opposite Universal Display and Lendlease positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Universal Display 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.| Universal Display vs. Corsair Gaming | Universal Display vs. Dalata Hotel Group | Universal Display vs. SOGECLAIR SA INH | Universal Display vs. Westinghouse Air Brake |
| Lendlease vs. Universal Display | Lendlease vs. Playtech plc | Lendlease vs. Vulcan Materials | Lendlease vs. Applied Materials |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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