Correlation Between Luolai Home and Henan Shuanghui
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By analyzing existing cross correlation between Luolai Home Textile and Henan Shuanghui Investment, you can compare the effects of market volatilities on Luolai Home and Henan Shuanghui 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 Luolai Home with a short position of Henan Shuanghui. Check out your portfolio center. Please also check ongoing floating volatility patterns of Luolai Home and Henan Shuanghui.
Diversification Opportunities for Luolai Home and Henan Shuanghui
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Luolai and Henan is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Luolai Home Textile and Henan Shuanghui Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Henan Shuanghui Inve and Luolai Home 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 Luolai Home Textile are associated (or correlated) with Henan Shuanghui. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Henan Shuanghui Inve has no effect on the direction of Luolai Home i.e., Luolai Home and Henan Shuanghui go up and down completely randomly.
Pair Corralation between Luolai Home and Henan Shuanghui
Assuming the 90 days trading horizon Luolai Home Textile is expected to generate 1.41 times more return on investment than Henan Shuanghui. However, Luolai Home is 1.41 times more volatile than Henan Shuanghui Investment. It trades about 0.11 of its potential returns per unit of risk. Henan Shuanghui Investment is currently generating about -0.06 per unit of risk. If you would invest 732.00 in Luolai Home Textile on August 25, 2024 and sell it today you would earn a total of 35.00 from holding Luolai Home Textile or generate 4.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Luolai Home Textile vs. Henan Shuanghui Investment
Performance |
| Timeline |
| Luolai Home Textile |
| Henan Shuanghui Inve |
Luolai Home and Henan Shuanghui Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Luolai Home and Henan Shuanghui
The main advantage of trading using opposite Luolai Home and Henan Shuanghui positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Luolai Home position performs unexpectedly, Henan Shuanghui 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 Henan Shuanghui will offset losses from the drop in Henan Shuanghui's long position.| Luolai Home vs. Cangzhou Mingzhu Plastic | Luolai Home vs. Xinke Material | Luolai Home vs. Ningxia Younglight Chemicals | Luolai Home vs. GRIPM Advanced Materials |
| Henan Shuanghui vs. Luolai Home Textile | Henan Shuanghui vs. Marssenger Kitchenware Co | Henan Shuanghui vs. Der International Home | Henan Shuanghui vs. Nanjing OLO Home |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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