Correlation Between China Securities and Luzhou Lao
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By analyzing existing cross correlation between China Securities 800 and Luzhou Lao Jiao, you can compare the effects of market volatilities on China Securities and Luzhou Lao 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 China Securities with a short position of Luzhou Lao. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Securities and Luzhou Lao.
Diversification Opportunities for China Securities and Luzhou Lao
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between China and Luzhou is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding China Securities 800 and Luzhou Lao Jiao in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Luzhou Lao Jiao and China Securities 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 China Securities 800 are associated (or correlated) with Luzhou Lao. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Luzhou Lao Jiao has no effect on the direction of China Securities i.e., China Securities and Luzhou Lao go up and down completely randomly.
Pair Corralation between China Securities and Luzhou Lao
Assuming the 90 days trading horizon China Securities 800 is expected to generate 0.53 times more return on investment than Luzhou Lao. However, China Securities 800 is 1.9 times less risky than Luzhou Lao. It trades about -0.1 of its potential returns per unit of risk. Luzhou Lao Jiao is currently generating about -0.06 per unit of risk. If you would invest 427,943 in China Securities 800 on August 28, 2024 and sell it today you would lose (13,470) from holding China Securities 800 or give up 3.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
China Securities 800 vs. Luzhou Lao Jiao
Performance |
| Timeline |
China Securities and Luzhou Lao Volatility Contrast
Predicted Return Density |
| Returns |
China Securities 800
Pair trading matchups for China Securities
Luzhou Lao Jiao
Pair trading matchups for Luzhou Lao
Pair Trading with China Securities and Luzhou Lao
The main advantage of trading using opposite China Securities and Luzhou Lao positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Securities position performs unexpectedly, Luzhou Lao 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 Luzhou Lao will offset losses from the drop in Luzhou Lao's long position.| China Securities vs. Beijing Mainstreets Investment | China Securities vs. Dareway Software Co | China Securities vs. Shanghai Metersbonwe FashionAccessories | China Securities vs. Guangzhou Seagull Kitchen |
| Luzhou Lao vs. BYD Co Ltd | Luzhou Lao vs. China Mobile Limited | Luzhou Lao vs. Agricultural Bank of | Luzhou Lao vs. Industrial and Commercial |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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