Correlation Between Banque Cantonale and LG Clean
Can any of the company-specific risk be diversified away by investing in both Banque Cantonale and LG Clean 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 Banque Cantonale and LG Clean into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Banque Cantonale du and LG Clean Water, you can compare the effects of market volatilities on Banque Cantonale and LG Clean 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 Banque Cantonale with a short position of LG Clean. Check out your portfolio center. Please also check ongoing floating volatility patterns of Banque Cantonale and LG Clean.
Diversification Opportunities for Banque Cantonale and LG Clean
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Banque and GLUG is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Banque Cantonale du and LG Clean Water in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LG Clean Water and Banque Cantonale 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 Banque Cantonale du are associated (or correlated) with LG Clean. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LG Clean Water has no effect on the direction of Banque Cantonale i.e., Banque Cantonale and LG Clean go up and down completely randomly.
Pair Corralation between Banque Cantonale and LG Clean
Assuming the 90 days trading horizon Banque Cantonale is expected to generate 2.47 times less return on investment than LG Clean. But when comparing it to its historical volatility, Banque Cantonale du is 1.6 times less risky than LG Clean. It trades about 0.04 of its potential returns per unit of risk. LG Clean Water is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,391 in LG Clean Water on September 25, 2024 and sell it today you would earn a total of 190.00 from holding LG Clean Water or generate 13.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
Banque Cantonale du vs. LG Clean Water
Performance |
| Timeline |
| Banque Cantonale |
| LG Clean Water |
Banque Cantonale and LG Clean Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Banque Cantonale and LG Clean
The main advantage of trading using opposite Banque Cantonale and LG Clean positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Banque Cantonale position performs unexpectedly, LG Clean 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 LG Clean will offset losses from the drop in LG Clean's long position.| Banque Cantonale vs. Banque Cantonale | Banque Cantonale vs. St Galler Kantonalbank | Banque Cantonale vs. Berner Kantonalbank AG | Banque Cantonale vs. Valiant Holding AG |
| LG Clean vs. UBSFund Solutions MSCI | LG Clean vs. Vanguard SP 500 | LG Clean vs. iShares VII PLC | LG Clean vs. iShares Core SP |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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