Correlation Between Lepanto Consolidated and Bloomberry Resorts

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

By analyzing existing cross correlation between Lepanto Consolidated Mining and Bloomberry Resorts Corp, you can compare the effects of market volatilities on Lepanto Consolidated and Bloomberry Resorts 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 Lepanto Consolidated with a short position of Bloomberry Resorts. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lepanto Consolidated and Bloomberry Resorts.

Diversification Opportunities for Lepanto Consolidated and Bloomberry Resorts

0.58

Correlation Coefficient

Lepanto Consolidated  Bloomberry Resorts

Very weak diversification

The 3 months correlation between Lepanto and Bloomberry is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Lepanto Consolidated Mining and Bloomberry Resorts Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bloomberry Resorts Corp and Lepanto Consolidated 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 Lepanto Consolidated Mining are associated (or correlated) with Bloomberry Resorts. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bloomberry Resorts Corp has no effect on the direction of Lepanto Consolidated i.e., Lepanto Consolidated and Bloomberry Resorts go up and down completely randomly.

Pair Corralation between Lepanto Consolidated and Bloomberry Resorts

Assuming the 90 days trading horizon Lepanto Consolidated Mining is expected to generate 1.42 times more return on investment than Bloomberry Resorts. However, Lepanto Consolidated is 1.42 times more volatile than Bloomberry Resorts Corp. It trades about -0.02 of its potential returns per unit of risk. Bloomberry Resorts Corp is currently generating about -0.05 per unit of risk. If you would invest  12.00  in Lepanto Consolidated Mining on September 29, 2024 and sell it today you would lose (5.30) from holding Lepanto Consolidated Mining or give up 44.17% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	96.49%
Values	Daily Returns

Lepanto Consolidated Mining  vs.  Bloomberry Resorts Corp

Lepanto Consolidated

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Lepanto Consolidated Mining are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Lepanto Consolidated is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Bloomberry Resorts Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Bloomberry Resorts Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Even with uncertain performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in January 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Lepanto Consolidated and Bloomberry Resorts

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

The idea behind Lepanto Consolidated Mining and Bloomberry Resorts Corp 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.