Correlation Between Weyerhaeuser and Ladenburg Thalmann

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

By analyzing existing cross correlation between Weyerhaeuser and Ladenburg Thalmann Financial, you can compare the effects of market volatilities on Weyerhaeuser and Ladenburg Thalmann 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 Weyerhaeuser with a short position of Ladenburg Thalmann. Check out your portfolio center. Please also check ongoing floating volatility patterns of Weyerhaeuser and Ladenburg Thalmann.

Diversification Opportunities for Weyerhaeuser and Ladenburg Thalmann

-0.63

Correlation Coefficient

Weyerhaeuser  Ladenburg Thalmann

Excellent diversification

The 3 months correlation between Weyerhaeuser and Ladenburg is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Weyerhaeuser and Ladenburg Thalmann Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ladenburg Thalmann and Weyerhaeuser 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 Weyerhaeuser are associated (or correlated) with Ladenburg Thalmann. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ladenburg Thalmann has no effect on the direction of Weyerhaeuser i.e., Weyerhaeuser and Ladenburg Thalmann go up and down completely randomly.

Pair Corralation between Weyerhaeuser and Ladenburg Thalmann

If you would invest  1,710  in Ladenburg Thalmann Financial on October 11, 2024 and sell it today you would earn a total of  0.00  from holding Ladenburg Thalmann Financial or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	1.64%
Values	Daily Returns

Weyerhaeuser  vs.  Ladenburg Thalmann Financial

Weyerhaeuser

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Weyerhaeuser has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Ladenburg Thalmann

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ladenburg Thalmann Financial has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Ladenburg Thalmann is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Weyerhaeuser and Ladenburg Thalmann

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

The idea behind Weyerhaeuser and Ladenburg Thalmann Financial 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.