Correlation Between China Railway and Lutian Machinery
Specify exactly 2 symbols:
By analyzing existing cross correlation between China Railway Materials and Lutian Machinery Co, you can compare the effects of market volatilities on China Railway 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 China Railway with a short position of Lutian Machinery. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Railway and Lutian Machinery.
Diversification Opportunities for China Railway and Lutian Machinery
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between China and Lutian is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding China Railway Materials and Lutian Machinery Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lutian Machinery and China Railway 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 Railway Materials 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 China Railway i.e., China Railway and Lutian Machinery go up and down completely randomly.
Pair Corralation between China Railway and Lutian Machinery
Assuming the 90 days trading horizon China Railway is expected to generate 1.84 times less return on investment than Lutian Machinery. But when comparing it to its historical volatility, China Railway Materials is 1.26 times less risky than Lutian Machinery. It trades about 0.01 of its potential returns per unit of risk. Lutian Machinery Co is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 1,478 in Lutian Machinery Co on September 12, 2024 and sell it today you would earn a total of 91.00 from holding Lutian Machinery Co or generate 6.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Railway Materials vs. Lutian Machinery Co
Performance |
| Timeline |
| China Railway Materials |
| Lutian Machinery |
China Railway and Lutian Machinery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Railway and Lutian Machinery
The main advantage of trading using opposite China Railway and Lutian Machinery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Railway 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.| China Railway vs. Lutian Machinery Co | China Railway vs. PetroChina Co Ltd | China Railway vs. Bank of China | China Railway vs. Gansu Jiu Steel |
| Lutian Machinery vs. Agricultural Bank of | Lutian Machinery vs. Industrial and Commercial | Lutian Machinery vs. Bank of China | Lutian Machinery vs. PetroChina Co Ltd |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
Other Complementary Tools
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Global Correlations Find global opportunities by holding instruments from different markets |