Correlation Between Woori Financial and Lakeland Financial
Can any of the company-specific risk be diversified away by investing in both Woori Financial and Lakeland Financial 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 Woori Financial and Lakeland Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Woori Financial Group and Lakeland Financial, you can compare the effects of market volatilities on Woori Financial and Lakeland Financial 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 Woori Financial with a short position of Lakeland Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Woori Financial and Lakeland Financial.
Diversification Opportunities for Woori Financial and Lakeland Financial
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Woori and Lakeland is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Woori Financial Group and Lakeland Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lakeland Financial and Woori Financial 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 Woori Financial Group are associated (or correlated) with Lakeland Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lakeland Financial has no effect on the direction of Woori Financial i.e., Woori Financial and Lakeland Financial go up and down completely randomly.
Pair Corralation between Woori Financial and Lakeland Financial
Allowing for the 90-day total investment horizon Woori Financial Group is expected to under-perform the Lakeland Financial. But the stock apears to be less risky and, when comparing its historical volatility, Woori Financial Group is 1.34 times less risky than Lakeland Financial. The stock trades about 0.0 of its potential returns per unit of risk. The Lakeland Financial is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 6,716 in Lakeland Financial on August 28, 2024 and sell it today you would earn a total of 869.00 from holding Lakeland Financial or generate 12.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Woori Financial Group vs. Lakeland Financial
Performance |
| Timeline |
| Woori Financial Group |
| Lakeland Financial |
Woori Financial and Lakeland Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Woori Financial and Lakeland Financial
The main advantage of trading using opposite Woori Financial and Lakeland Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Woori Financial position performs unexpectedly, Lakeland Financial 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 Lakeland Financial will offset losses from the drop in Lakeland Financial's long position.| Woori Financial vs. Banco Santander Brasil | Woori Financial vs. CrossFirst Bankshares | Woori Financial vs. Banco Bradesco SA | Woori Financial vs. CF Bankshares |
| Lakeland Financial vs. Home Bancorp | Lakeland Financial vs. Heritage Financial | Lakeland Financial vs. First Northwest Bancorp | Lakeland Financial vs. HomeTrust Bancshares |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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