Correlation Between Team Internet and Lendinvest PLC

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

By analyzing existing cross correlation between Team Internet Group and Lendinvest PLC, you can compare the effects of market volatilities on Team Internet and Lendinvest PLC 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 Team Internet with a short position of Lendinvest PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Team Internet and Lendinvest PLC.

Diversification Opportunities for Team Internet and Lendinvest PLC

-0.69

Correlation Coefficient

Team Internet  Lendinvest PLC

Excellent diversification

The 3 months correlation between Team and Lendinvest is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Team Internet Group and Lendinvest PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lendinvest PLC and Team Internet 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 Team Internet Group are associated (or correlated) with Lendinvest PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lendinvest PLC has no effect on the direction of Team Internet i.e., Team Internet and Lendinvest PLC go up and down completely randomly.

Pair Corralation between Team Internet and Lendinvest PLC

Assuming the 90 days trading horizon Team Internet Group is expected to under-perform the Lendinvest PLC. In addition to that, Team Internet is 5.01 times more volatile than Lendinvest PLC. It trades about -0.04 of its total potential returns per unit of risk. Lendinvest PLC is currently generating about 0.13 per unit of volatility. If you would invest  2,450  in Lendinvest PLC on December 29, 2024 and sell it today you would earn a total of  300.00  from holding Lendinvest PLC or generate 12.24% return on investment over 90 days.

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

Team Internet Group  vs.  Lendinvest PLC

Team Internet Group

Risk-Adjusted Performance

Very Weak

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

Lendinvest PLC

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Lendinvest PLC are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Lendinvest PLC may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Team Internet and Lendinvest PLC

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

The idea behind Team Internet Group and Lendinvest PLC 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.