Correlation Between Lonkey Industrial and Lutian Machinery
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By analyzing existing cross correlation between Lonkey Industrial Co and Lutian Machinery Co, you can compare the effects of market volatilities on Lonkey Industrial and Lutian Machinery 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 Lonkey Industrial with a short position of Lutian Machinery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lonkey Industrial and Lutian Machinery.
Diversification Opportunities for Lonkey Industrial and Lutian Machinery
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Lonkey and Lutian is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Lonkey Industrial Co and Lutian Machinery Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lutian Machinery and Lonkey Industrial 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 Lonkey Industrial Co are associated (or correlated) with Lutian Machinery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lutian Machinery has no effect on the direction of Lonkey Industrial i.e., Lonkey Industrial and Lutian Machinery go up and down completely randomly.
Pair Corralation between Lonkey Industrial and Lutian Machinery
Assuming the 90 days trading horizon Lonkey Industrial is expected to generate 1.84 times less return on investment than Lutian Machinery. In addition to that, Lonkey Industrial is 1.12 times more volatile than Lutian Machinery Co. It trades about 0.0 of its total potential returns per unit of risk. Lutian Machinery Co is currently generating about 0.01 per unit of volatility. If you would invest 1,617 in Lutian Machinery Co on September 2, 2024 and sell it today you would lose (54.00) from holding Lutian Machinery Co or give up 3.34% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lonkey Industrial Co vs. Lutian Machinery Co
Performance |
| Timeline |
| Lonkey Industrial |
| Lutian Machinery |
Lonkey Industrial and Lutian Machinery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lonkey Industrial and Lutian Machinery
The main advantage of trading using opposite Lonkey Industrial and Lutian Machinery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lonkey Industrial position performs unexpectedly, Lutian Machinery 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 Lutian Machinery will offset losses from the drop in Lutian Machinery's long position.| Lonkey Industrial vs. Cultural Investment Holdings | Lonkey Industrial vs. Gome Telecom Equipment | Lonkey Industrial vs. Bus Online Co | Lonkey Industrial vs. Holitech Technology Co |
| Lutian Machinery vs. Hangzhou Gaoxin Rubber | Lutian Machinery vs. Chengtun Mining Group | Lutian Machinery vs. Eastern Air Logistics | Lutian Machinery vs. Suzhou Xingye Material |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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