Correlation Between CapitaLand Investment and Live Ventures

Can any of the company-specific risk be diversified away by investing in both CapitaLand Investment and Live Ventures 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 CapitaLand Investment and Live Ventures into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between CapitaLand Investment Limited and Live Ventures, you can compare the effects of market volatilities on CapitaLand Investment and Live Ventures 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 CapitaLand Investment with a short position of Live Ventures. Check out your portfolio center. Please also check ongoing floating volatility patterns of CapitaLand Investment and Live Ventures.

Diversification Opportunities for CapitaLand Investment and Live Ventures

0.78

Correlation Coefficient

CapitaLand Investment  Live Ventures

Poor diversification

The 3 months correlation between CapitaLand and Live is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding CapitaLand Investment Limited and Live Ventures in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Live Ventures and CapitaLand Investment 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 CapitaLand Investment Limited are associated (or correlated) with Live Ventures. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Live Ventures has no effect on the direction of CapitaLand Investment i.e., CapitaLand Investment and Live Ventures go up and down completely randomly.

Pair Corralation between CapitaLand Investment and Live Ventures

Assuming the 90 days horizon CapitaLand Investment Limited is expected to generate 0.49 times more return on investment than Live Ventures. However, CapitaLand Investment Limited is 2.02 times less risky than Live Ventures. It trades about 0.19 of its potential returns per unit of risk. Live Ventures is currently generating about 0.06 per unit of risk. If you would invest  182.00  in CapitaLand Investment Limited on September 24, 2024 and sell it today you would earn a total of  17.00  from holding CapitaLand Investment Limited or generate 9.34% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

CapitaLand Investment Limited  vs.  Live Ventures

CapitaLand Investment

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CapitaLand Investment Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's essential indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Live Ventures

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Live Ventures has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of inconsistent performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in January 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with CapitaLand Investment and Live Ventures

The main advantage of trading using opposite CapitaLand Investment and Live Ventures positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CapitaLand Investment position performs unexpectedly, Live Ventures 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 Live Ventures will offset losses from the drop in Live Ventures' long position.

The idea behind CapitaLand Investment Limited and Live Ventures pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Commodity Directory module to find actively traded commodities issued by global exchanges.