Correlation Between Luolai Home and StarPower Semiconductor
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By analyzing existing cross correlation between Luolai Home Textile and StarPower Semiconductor, you can compare the effects of market volatilities on Luolai Home and StarPower Semiconductor 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 StarPower Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Luolai Home and StarPower Semiconductor.
Diversification Opportunities for Luolai Home and StarPower Semiconductor
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Luolai and StarPower is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Luolai Home Textile and StarPower Semiconductor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on StarPower Semiconductor 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 StarPower Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of StarPower Semiconductor has no effect on the direction of Luolai Home i.e., Luolai Home and StarPower Semiconductor go up and down completely randomly.
Pair Corralation between Luolai Home and StarPower Semiconductor
Assuming the 90 days trading horizon Luolai Home Textile is expected to generate 1.18 times more return on investment than StarPower Semiconductor. However, Luolai Home is 1.18 times more volatile than StarPower Semiconductor. It trades about -0.14 of its potential returns per unit of risk. StarPower Semiconductor is currently generating about -0.23 per unit of risk. If you would invest 796.00 in Luolai Home Textile on October 28, 2024 and sell it today you would lose (53.00) from holding Luolai Home Textile or give up 6.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Luolai Home Textile vs. StarPower Semiconductor
Performance |
| Timeline |
| Luolai Home Textile |
| StarPower Semiconductor |
Luolai Home and StarPower Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Luolai Home and StarPower Semiconductor
The main advantage of trading using opposite Luolai Home and StarPower Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Luolai Home position performs unexpectedly, StarPower Semiconductor 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 StarPower Semiconductor will offset losses from the drop in StarPower Semiconductor's long position.| Luolai Home vs. Sichuan Yahua Industrial | Luolai Home vs. Guocheng Mining Co | Luolai Home vs. Jiangsu Financial Leasing | Luolai Home vs. Soochow Suzhou Industrial |
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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