Correlation Between Lloyds Banking and Aozora Bank
Can any of the company-specific risk be diversified away by investing in both Lloyds Banking and Aozora Bank 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 Lloyds Banking and Aozora Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lloyds Banking Group and Aozora Bank Ltd, you can compare the effects of market volatilities on Lloyds Banking and Aozora Bank 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 Lloyds Banking with a short position of Aozora Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lloyds Banking and Aozora Bank.
Diversification Opportunities for Lloyds Banking and Aozora Bank
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Lloyds and Aozora is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Lloyds Banking Group and Aozora Bank Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aozora Bank and Lloyds Banking 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 Lloyds Banking Group are associated (or correlated) with Aozora Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aozora Bank has no effect on the direction of Lloyds Banking i.e., Lloyds Banking and Aozora Bank go up and down completely randomly.
Pair Corralation between Lloyds Banking and Aozora Bank
If you would invest 65.00 in Lloyds Banking Group on September 24, 2024 and sell it today you would earn a total of 3.00 from holding Lloyds Banking Group or generate 4.62% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 95.24% |
Values | Daily Returns |
Lloyds Banking Group vs. Aozora Bank Ltd
Performance |
Timeline |
Lloyds Banking Group |
Aozora Bank |
Lloyds Banking and Aozora Bank Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Lloyds Banking and Aozora Bank
The main advantage of trading using opposite Lloyds Banking and Aozora Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lloyds Banking position performs unexpectedly, Aozora Bank 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 Aozora Bank will offset losses from the drop in Aozora Bank's long position.Lloyds Banking vs. PT Bank Rakyat | Lloyds Banking vs. Barclays PLC | Lloyds Banking vs. Bank Mandiri Persero | Lloyds Banking vs. China Petroleum Chemical |
Aozora Bank vs. Banco Bradesco SA | Aozora Bank vs. Itau Unibanco Banco | Aozora Bank vs. Lloyds Banking Group | Aozora Bank vs. Deutsche Bank AG |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
Transaction History View history of all your transactions and understand their impact on performance | |
Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon |