Correlation Between Lesaka Technologies and Hosken Consolidated
Can any of the company-specific risk be diversified away by investing in both Lesaka Technologies and Hosken Consolidated 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 Lesaka Technologies and Hosken Consolidated into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lesaka Technologies and Hosken Consolidated Investments, you can compare the effects of market volatilities on Lesaka Technologies and Hosken Consolidated 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 Lesaka Technologies with a short position of Hosken Consolidated. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lesaka Technologies and Hosken Consolidated.
Diversification Opportunities for Lesaka Technologies and Hosken Consolidated
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Lesaka and Hosken is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Lesaka Technologies and Hosken Consolidated Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hosken Consolidated and Lesaka Technologies 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 Lesaka Technologies are associated (or correlated) with Hosken Consolidated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hosken Consolidated has no effect on the direction of Lesaka Technologies i.e., Lesaka Technologies and Hosken Consolidated go up and down completely randomly.
Pair Corralation between Lesaka Technologies and Hosken Consolidated
Assuming the 90 days trading horizon Lesaka Technologies is expected to generate 1.76 times more return on investment than Hosken Consolidated. However, Lesaka Technologies is 1.76 times more volatile than Hosken Consolidated Investments. It trades about 0.02 of its potential returns per unit of risk. Hosken Consolidated Investments is currently generating about -0.55 per unit of risk. If you would invest 900,200 in Lesaka Technologies on September 24, 2024 and sell it today you would earn a total of 2,900 from holding Lesaka Technologies or generate 0.32% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Lesaka Technologies vs. Hosken Consolidated Investment
Performance |
Timeline |
Lesaka Technologies |
Hosken Consolidated |
Lesaka Technologies and Hosken Consolidated Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Lesaka Technologies and Hosken Consolidated
The main advantage of trading using opposite Lesaka Technologies and Hosken Consolidated positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lesaka Technologies position performs unexpectedly, Hosken Consolidated 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 Hosken Consolidated will offset losses from the drop in Hosken Consolidated's long position.Lesaka Technologies vs. Bytes Technology | Lesaka Technologies vs. ISA Holdings | Lesaka Technologies vs. Thungela Resources Limited | Lesaka Technologies vs. Pepkor Holdings |
Hosken Consolidated vs. Capitec Bank Holdings | Hosken Consolidated vs. RCL Foods | Hosken Consolidated vs. Frontier Transport Holdings | Hosken Consolidated vs. Lesaka Technologies |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
Other Complementary Tools
Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance |