Correlation Between Lianhe Chemical and Sportsoul
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By analyzing existing cross correlation between Lianhe Chemical Technology and Sportsoul Co Ltd, you can compare the effects of market volatilities on Lianhe Chemical and Sportsoul 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 Lianhe Chemical with a short position of Sportsoul. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lianhe Chemical and Sportsoul.
Diversification Opportunities for Lianhe Chemical and Sportsoul
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Lianhe and Sportsoul is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Lianhe Chemical Technology and Sportsoul Co Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sportsoul and Lianhe Chemical 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 Lianhe Chemical Technology are associated (or correlated) with Sportsoul. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sportsoul has no effect on the direction of Lianhe Chemical i.e., Lianhe Chemical and Sportsoul go up and down completely randomly.
Pair Corralation between Lianhe Chemical and Sportsoul
Assuming the 90 days trading horizon Lianhe Chemical is expected to generate 10.97 times less return on investment than Sportsoul. But when comparing it to its historical volatility, Lianhe Chemical Technology is 1.48 times less risky than Sportsoul. It trades about 0.01 of its potential returns per unit of risk. Sportsoul Co Ltd is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1,258 in Sportsoul Co Ltd on August 28, 2024 and sell it today you would earn a total of 85.00 from holding Sportsoul Co Ltd or generate 6.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lianhe Chemical Technology vs. Sportsoul Co Ltd
Performance |
| Timeline |
| Lianhe Chemical Tech |
| Sportsoul |
Lianhe Chemical and Sportsoul Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lianhe Chemical and Sportsoul
The main advantage of trading using opposite Lianhe Chemical and Sportsoul positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lianhe Chemical position performs unexpectedly, Sportsoul 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 Sportsoul will offset losses from the drop in Sportsoul's long position.| Lianhe Chemical vs. Sportsoul Co Ltd | Lianhe Chemical vs. Dawning Information Industry | Lianhe Chemical vs. AVCON Information Tech | Lianhe Chemical vs. Focus Media Information |
| Sportsoul vs. Shenzhen MYS Environmental | Sportsoul vs. AVIC Fund Management | Sportsoul vs. Shenzhen Bingchuan Network | Sportsoul vs. Penghua Shenzhen Energy |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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