Correlation Between Yokohama Rubber and Lendlease
Can any of the company-specific risk be diversified away by investing in both Yokohama Rubber 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 Yokohama Rubber and Lendlease into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Yokohama Rubber and Lendlease Group, you can compare the effects of market volatilities on Yokohama Rubber 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 Yokohama Rubber with a short position of Lendlease. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yokohama Rubber and Lendlease.
Diversification Opportunities for Yokohama Rubber and Lendlease
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Yokohama and Lendlease is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding The Yokohama Rubber and Lendlease Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lendlease Group and Yokohama Rubber 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 The Yokohama Rubber 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 Yokohama Rubber i.e., Yokohama Rubber and Lendlease go up and down completely randomly.
Pair Corralation between Yokohama Rubber and Lendlease
Assuming the 90 days trading horizon The Yokohama Rubber is expected to generate 0.85 times more return on investment than Lendlease. However, The Yokohama Rubber is 1.17 times less risky than Lendlease. It trades about 0.18 of its potential returns per unit of risk. Lendlease Group is currently generating about 0.02 per unit of risk. If you would invest 2,060 in The Yokohama Rubber on November 6, 2024 and sell it today you would earn a total of 100.00 from holding The Yokohama Rubber or generate 4.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Yokohama Rubber vs. Lendlease Group
Performance |
| Timeline |
| Yokohama Rubber |
| Lendlease Group |
Yokohama Rubber and Lendlease Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yokohama Rubber and Lendlease
The main advantage of trading using opposite Yokohama Rubber and Lendlease positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yokohama Rubber 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.| Yokohama Rubber vs. BRIT AMER TOBACCO | Yokohama Rubber vs. Discover Financial Services | Yokohama Rubber vs. Direct Line Insurance | Yokohama Rubber vs. JAPAN TOBACCO UNSPADR12 |
| Lendlease vs. SILVER BULLET DATA | Lendlease vs. Wizz Air Holdings | Lendlease vs. SOGECLAIR SA INH | Lendlease vs. DICKER DATA LTD |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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