Correlation Between YouGov Plc and Lindsell Train
Can any of the company-specific risk be diversified away by investing in both YouGov Plc and Lindsell Train 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 YouGov Plc and Lindsell Train into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between YouGov plc and Lindsell Train Investment, you can compare the effects of market volatilities on YouGov Plc and Lindsell Train 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 YouGov Plc with a short position of Lindsell Train. Check out your portfolio center. Please also check ongoing floating volatility patterns of YouGov Plc and Lindsell Train.
Diversification Opportunities for YouGov Plc and Lindsell Train
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between YouGov and Lindsell is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding YouGov plc and Lindsell Train Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lindsell Train Investment and YouGov Plc 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 YouGov plc are associated (or correlated) with Lindsell Train. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lindsell Train Investment has no effect on the direction of YouGov Plc i.e., YouGov Plc and Lindsell Train go up and down completely randomly.
Pair Corralation between YouGov Plc and Lindsell Train
Assuming the 90 days trading horizon YouGov plc is expected to generate 2.56 times more return on investment than Lindsell Train. However, YouGov Plc is 2.56 times more volatile than Lindsell Train Investment. It trades about 0.11 of its potential returns per unit of risk. Lindsell Train Investment is currently generating about 0.03 per unit of risk. If you would invest 35,900 in YouGov plc on November 28, 2024 and sell it today you would earn a total of 2,500 from holding YouGov plc or generate 6.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
YouGov plc vs. Lindsell Train Investment
Performance |
| Timeline |
| YouGov plc |
| Lindsell Train Investment |
YouGov Plc and Lindsell Train Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with YouGov Plc and Lindsell Train
The main advantage of trading using opposite YouGov Plc and Lindsell Train positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if YouGov Plc position performs unexpectedly, Lindsell Train 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 Lindsell Train will offset losses from the drop in Lindsell Train's long position.| YouGov Plc vs. Ross Stores | YouGov Plc vs. Costco Wholesale Corp | YouGov Plc vs. Planet Fitness Cl | YouGov Plc vs. Omega Healthcare Investors |
| Lindsell Train vs. Central Asia Metals | Lindsell Train vs. JD Sports Fashion | Lindsell Train vs. Associated British Foods | Lindsell Train vs. AfriTin Mining |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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