Correlation Between Advanced Technology and Lecron Energy
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By analyzing existing cross correlation between Advanced Technology Materials and Lecron Energy Saving, you can compare the effects of market volatilities on Advanced Technology and Lecron Energy 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 Advanced Technology with a short position of Lecron Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advanced Technology and Lecron Energy.
Diversification Opportunities for Advanced Technology and Lecron Energy
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Advanced and Lecron is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Advanced Technology Materials and Lecron Energy Saving in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lecron Energy Saving and Advanced Technology 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 Advanced Technology Materials are associated (or correlated) with Lecron Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lecron Energy Saving has no effect on the direction of Advanced Technology i.e., Advanced Technology and Lecron Energy go up and down completely randomly.
Pair Corralation between Advanced Technology and Lecron Energy
Assuming the 90 days trading horizon Advanced Technology Materials is expected to generate 0.93 times more return on investment than Lecron Energy. However, Advanced Technology Materials is 1.07 times less risky than Lecron Energy. It trades about 0.09 of its potential returns per unit of risk. Lecron Energy Saving is currently generating about -0.14 per unit of risk. If you would invest 1,130 in Advanced Technology Materials on October 24, 2024 and sell it today you would earn a total of 56.00 from holding Advanced Technology Materials or generate 4.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Advanced Technology Materials vs. Lecron Energy Saving
Performance |
| Timeline |
| Advanced Technology |
| Lecron Energy Saving |
Advanced Technology and Lecron Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Advanced Technology and Lecron Energy
The main advantage of trading using opposite Advanced Technology and Lecron Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advanced Technology position performs unexpectedly, Lecron Energy 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 Lecron Energy will offset losses from the drop in Lecron Energy's long position.| Advanced Technology vs. Hefei Metalforming Mach | Advanced Technology vs. North Copper Shanxi | Advanced Technology vs. Citic Offshore Helicopter | Advanced Technology vs. Marssenger Kitchenware Co |
| Lecron Energy vs. Caihong Display Devices | Lecron Energy vs. Konfoong Materials International | Lecron Energy vs. Advanced Technology Materials | Lecron Energy vs. China Sports Industry |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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