Correlation Between LIVINGTRUST MORTGAGE and DEAP CAPITAL

Can any of the company-specific risk be diversified away by investing in both LIVINGTRUST MORTGAGE and DEAP CAPITAL 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 LIVINGTRUST MORTGAGE and DEAP CAPITAL into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between LIVINGTRUST MORTGAGE BANK and DEAP CAPITAL MANAGEMENT, you can compare the effects of market volatilities on LIVINGTRUST MORTGAGE and DEAP CAPITAL 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 LIVINGTRUST MORTGAGE with a short position of DEAP CAPITAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of LIVINGTRUST MORTGAGE and DEAP CAPITAL.

Diversification Opportunities for LIVINGTRUST MORTGAGE and DEAP CAPITAL

0.28

Correlation Coefficient

LIVINGTRUST MORTGAGE  DEAP CAPITAL

Modest diversification

The 3 months correlation between LIVINGTRUST and DEAP is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding LIVINGTRUST MORTGAGE BANK and DEAP CAPITAL MANAGEMENT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DEAP CAPITAL MANAGEMENT and LIVINGTRUST MORTGAGE 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 LIVINGTRUST MORTGAGE BANK are associated (or correlated) with DEAP CAPITAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DEAP CAPITAL MANAGEMENT has no effect on the direction of LIVINGTRUST MORTGAGE i.e., LIVINGTRUST MORTGAGE and DEAP CAPITAL go up and down completely randomly.

Pair Corralation between LIVINGTRUST MORTGAGE and DEAP CAPITAL

Assuming the 90 days trading horizon LIVINGTRUST MORTGAGE BANK is expected to generate 1.52 times more return on investment than DEAP CAPITAL. However, LIVINGTRUST MORTGAGE is 1.52 times more volatile than DEAP CAPITAL MANAGEMENT. It trades about 0.5 of its potential returns per unit of risk. DEAP CAPITAL MANAGEMENT is currently generating about 0.28 per unit of risk. If you would invest  300.00  in LIVINGTRUST MORTGAGE BANK on October 10, 2024 and sell it today you would earn a total of  138.00  from holding LIVINGTRUST MORTGAGE BANK or generate 46.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	95.0%
Values	Daily Returns

LIVINGTRUST MORTGAGE BANK  vs.  DEAP CAPITAL MANAGEMENT

LIVINGTRUST MORTGAGE BANK

Risk-Adjusted Performance

20 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in LIVINGTRUST MORTGAGE BANK are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively inconsistent basic indicators, LIVINGTRUST MORTGAGE unveiled solid returns over the last few months and may actually be approaching a breakup point.

DEAP CAPITAL MANAGEMENT

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days DEAP CAPITAL MANAGEMENT has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest uncertain performance, the Stock's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Pair Trading with LIVINGTRUST MORTGAGE and DEAP CAPITAL

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

The idea behind LIVINGTRUST MORTGAGE BANK and DEAP CAPITAL MANAGEMENT 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.