Correlation Between Pinterest and LBTCOR

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

By analyzing existing cross correlation between Pinterest and LBTCOR 10875 15 JAN 31, you can compare the effects of market volatilities on Pinterest and LBTCOR 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 Pinterest with a short position of LBTCOR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pinterest and LBTCOR.

Diversification Opportunities for Pinterest and LBTCOR

0.68

Correlation Coefficient

Pinterest  LBTCOR

Poor diversification

The 3 months correlation between Pinterest and LBTCOR is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Pinterest and LBTCOR 10875 15 JAN 31 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LBTCOR 10875 15 and Pinterest 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 Pinterest are associated (or correlated) with LBTCOR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LBTCOR 10875 15 has no effect on the direction of Pinterest i.e., Pinterest and LBTCOR go up and down completely randomly.

Pair Corralation between Pinterest and LBTCOR

Given the investment horizon of 90 days Pinterest is expected to generate 6.06 times more return on investment than LBTCOR. However, Pinterest is 6.06 times more volatile than LBTCOR 10875 15 JAN 31. It trades about 0.06 of its potential returns per unit of risk. LBTCOR 10875 15 JAN 31 is currently generating about -0.06 per unit of risk. If you would invest  2,947  in Pinterest on December 23, 2024 and sell it today you would earn a total of  295.00  from holding Pinterest or generate 10.01% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	18.03%
Values	Daily Returns

Pinterest  vs.  LBTCOR 10875 15 JAN 31

Pinterest

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Pinterest are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating basic indicators, Pinterest unveiled solid returns over the last few months and may actually be approaching a breakup point.

LBTCOR 10875 15

Risk-Adjusted Performance

Very Weak

Over the last 90 days LBTCOR 10875 15 JAN 31 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, LBTCOR is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Pinterest and LBTCOR

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

The idea behind Pinterest and LBTCOR 10875 15 JAN 31 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.