Correlation Between Luolai Home and Shenzhen Mindray
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By analyzing existing cross correlation between Luolai Home Textile and Shenzhen Mindray Bio Medical, you can compare the effects of market volatilities on Luolai Home and Shenzhen Mindray 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 Shenzhen Mindray. Check out your portfolio center. Please also check ongoing floating volatility patterns of Luolai Home and Shenzhen Mindray.
Diversification Opportunities for Luolai Home and Shenzhen Mindray
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Luolai and Shenzhen is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Luolai Home Textile and Shenzhen Mindray Bio Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Mindray Bio 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 Shenzhen Mindray. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Mindray Bio has no effect on the direction of Luolai Home i.e., Luolai Home and Shenzhen Mindray go up and down completely randomly.
Pair Corralation between Luolai Home and Shenzhen Mindray
Assuming the 90 days trading horizon Luolai Home Textile is expected to generate 1.08 times more return on investment than Shenzhen Mindray. However, Luolai Home is 1.08 times more volatile than Shenzhen Mindray Bio Medical. It trades about 0.11 of its potential returns per unit of risk. Shenzhen Mindray Bio Medical is currently generating about -0.08 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 | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Luolai Home Textile vs. Shenzhen Mindray Bio Medical
Performance |
| Timeline |
| Luolai Home Textile |
| Shenzhen Mindray Bio |
Luolai Home and Shenzhen Mindray Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Luolai Home and Shenzhen Mindray
The main advantage of trading using opposite Luolai Home and Shenzhen Mindray positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Luolai Home position performs unexpectedly, Shenzhen Mindray 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 Shenzhen Mindray will offset losses from the drop in Shenzhen Mindray'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 |
| Shenzhen Mindray vs. Luolai Home Textile | Shenzhen Mindray vs. Ziel Home Furnishing | Shenzhen Mindray vs. Songz Automobile Air | Shenzhen Mindray vs. Guangdong Shenglu Telecommunication |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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