Correlation Between Shandong Longquan and INKON Life
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By analyzing existing cross correlation between Shandong Longquan Pipeline and INKON Life Technology, you can compare the effects of market volatilities on Shandong Longquan and INKON Life 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 Shandong Longquan with a short position of INKON Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Longquan and INKON Life.
Diversification Opportunities for Shandong Longquan and INKON Life
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shandong and INKON is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Longquan Pipeline and INKON Life Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INKON Life Technology and Shandong Longquan 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 Shandong Longquan Pipeline are associated (or correlated) with INKON Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INKON Life Technology has no effect on the direction of Shandong Longquan i.e., Shandong Longquan and INKON Life go up and down completely randomly.
Pair Corralation between Shandong Longquan and INKON Life
Assuming the 90 days trading horizon Shandong Longquan Pipeline is expected to under-perform the INKON Life. But the stock apears to be less risky and, when comparing its historical volatility, Shandong Longquan Pipeline is 1.07 times less risky than INKON Life. The stock trades about -0.28 of its potential returns per unit of risk. The INKON Life Technology is currently generating about -0.26 of returns per unit of risk over similar time horizon. If you would invest 1,001 in INKON Life Technology on October 12, 2024 and sell it today you would lose (125.00) from holding INKON Life Technology or give up 12.49% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shandong Longquan Pipeline vs. INKON Life Technology
Performance |
| Timeline |
| Shandong Longquan |
| INKON Life Technology |
Shandong Longquan and INKON Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Longquan and INKON Life
The main advantage of trading using opposite Shandong Longquan and INKON Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Longquan position performs unexpectedly, INKON Life 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 INKON Life will offset losses from the drop in INKON Life's long position.| Shandong Longquan vs. Hubei Xingfa Chemicals | Shandong Longquan vs. Haima Automobile Group | Shandong Longquan vs. Zhongshan Public Utilities | Shandong Longquan vs. Miracll Chemicals Co |
| INKON Life vs. Guangzhou Jinyi Media | INKON Life vs. Lontium Semiconductor Corp | INKON Life vs. Shandong Longquan Pipeline | INKON Life vs. Southern PublishingMedia 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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