Correlation Between Lake Sunapee and United Parcel
Can any of the company-specific risk be diversified away by investing in both Lake Sunapee and United Parcel 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 Lake Sunapee and United Parcel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lake Sunapee Bank and United Parcel Service, you can compare the effects of market volatilities on Lake Sunapee and United Parcel 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 Lake Sunapee with a short position of United Parcel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lake Sunapee and United Parcel.
Diversification Opportunities for Lake Sunapee and United Parcel
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Lake and United is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Lake Sunapee Bank and United Parcel Service in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Parcel Service and Lake Sunapee 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 Lake Sunapee Bank are associated (or correlated) with United Parcel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United Parcel Service has no effect on the direction of Lake Sunapee i.e., Lake Sunapee and United Parcel go up and down completely randomly.
Pair Corralation between Lake Sunapee and United Parcel
If you would invest (100.00) in Lake Sunapee Bank on December 30, 2023 and sell it today you would earn a total of 100.00 from holding Lake Sunapee Bank or generate -100.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 0.0% |
Values | Daily Returns |
Lake Sunapee Bank vs. United Parcel Service
Performance |
Timeline |
Lake Sunapee Bank |
Risk-Adjusted Performance
0 of 100
Low | High |
Very Weak
United Parcel Service |
Lake Sunapee and United Parcel Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Lake Sunapee and United Parcel
The main advantage of trading using opposite Lake Sunapee and United Parcel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lake Sunapee position performs unexpectedly, United Parcel 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 United Parcel will offset losses from the drop in United Parcel's long position.Lake Sunapee vs. Stepan Company | Lake Sunapee vs. Valhi Inc | Lake Sunapee vs. Sealed Air | Lake Sunapee vs. Willamette Valley Vineyards |
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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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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