Correlation Between Shenzhen Glory and Lutian Machinery
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By analyzing existing cross correlation between Shenzhen Glory Medical and Lutian Machinery Co, you can compare the effects of market volatilities on Shenzhen Glory and Lutian Machinery 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 Shenzhen Glory with a short position of Lutian Machinery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen Glory and Lutian Machinery.
Diversification Opportunities for Shenzhen Glory and Lutian Machinery
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Shenzhen and Lutian is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen Glory Medical and Lutian Machinery Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lutian Machinery and Shenzhen Glory 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 Shenzhen Glory Medical are associated (or correlated) with Lutian Machinery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lutian Machinery has no effect on the direction of Shenzhen Glory i.e., Shenzhen Glory and Lutian Machinery go up and down completely randomly.
Pair Corralation between Shenzhen Glory and Lutian Machinery
Assuming the 90 days trading horizon Shenzhen Glory Medical is expected to under-perform the Lutian Machinery. In addition to that, Shenzhen Glory is 1.25 times more volatile than Lutian Machinery Co. It trades about -0.03 of its total potential returns per unit of risk. Lutian Machinery Co is currently generating about 0.0 per unit of volatility. If you would invest 1,643 in Lutian Machinery Co on August 29, 2024 and sell it today you would lose (109.00) from holding Lutian Machinery Co or give up 6.63% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenzhen Glory Medical vs. Lutian Machinery Co
Performance |
| Timeline |
| Shenzhen Glory Medical |
| Lutian Machinery |
Shenzhen Glory and Lutian Machinery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenzhen Glory and Lutian Machinery
The main advantage of trading using opposite Shenzhen Glory and Lutian Machinery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen Glory position performs unexpectedly, Lutian Machinery 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 Lutian Machinery will offset losses from the drop in Lutian Machinery's long position.| Shenzhen Glory vs. PetroChina Co Ltd | Shenzhen Glory vs. China State Construction | Shenzhen Glory vs. China Mobile Limited | Shenzhen Glory vs. Industrial and Commercial |
| Lutian Machinery vs. Winner Medical Co | Lutian Machinery vs. Shengda Mining Co | Lutian Machinery vs. Guangdong Silvere Sci | Lutian Machinery vs. Guocheng Mining Co |
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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