Correlation Between Luolai Home and Beijing Baolande
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By analyzing existing cross correlation between Luolai Home Textile and Beijing Baolande Software, you can compare the effects of market volatilities on Luolai Home and Beijing Baolande 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 Beijing Baolande. Check out your portfolio center. Please also check ongoing floating volatility patterns of Luolai Home and Beijing Baolande.
Diversification Opportunities for Luolai Home and Beijing Baolande
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Luolai and Beijing is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Luolai Home Textile and Beijing Baolande Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beijing Baolande Software 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 Beijing Baolande. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beijing Baolande Software has no effect on the direction of Luolai Home i.e., Luolai Home and Beijing Baolande go up and down completely randomly.
Pair Corralation between Luolai Home and Beijing Baolande
Assuming the 90 days trading horizon Luolai Home Textile is expected to generate 0.44 times more return on investment than Beijing Baolande. However, Luolai Home Textile is 2.29 times less risky than Beijing Baolande. It trades about -0.02 of its potential returns per unit of risk. Beijing Baolande Software is currently generating about -0.01 per unit of risk. If you would invest 1,034 in Luolai Home Textile on October 11, 2024 and sell it today you would lose (201.00) from holding Luolai Home Textile or give up 19.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Luolai Home Textile vs. Beijing Baolande Software
Performance |
| Timeline |
| Luolai Home Textile |
| Beijing Baolande Software |
Luolai Home and Beijing Baolande Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Luolai Home and Beijing Baolande
The main advantage of trading using opposite Luolai Home and Beijing Baolande positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Luolai Home position performs unexpectedly, Beijing Baolande 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 Beijing Baolande will offset losses from the drop in Beijing Baolande's long position.| Luolai Home vs. BYD Co Ltd | Luolai Home vs. China Mobile Limited | Luolai Home vs. Agricultural Bank of | Luolai Home vs. Industrial and Commercial |
| Beijing Baolande vs. Fiberhome Telecommunication Technologies | Beijing Baolande vs. Ningbo Homelink Eco iTech | Beijing Baolande vs. Sanbo Hospital Management | Beijing Baolande vs. Luolai Home Textile |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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