Correlation Between Double Medical and Longjian Road
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By analyzing existing cross correlation between Double Medical Technology and Longjian Road Bridge, you can compare the effects of market volatilities on Double Medical and Longjian Road 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 Double Medical with a short position of Longjian Road. Check out your portfolio center. Please also check ongoing floating volatility patterns of Double Medical and Longjian Road.
Diversification Opportunities for Double Medical and Longjian Road
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Double and Longjian is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Double Medical Technology and Longjian Road Bridge in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Longjian Road Bridge and Double Medical 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 Double Medical Technology are associated (or correlated) with Longjian Road. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Longjian Road Bridge has no effect on the direction of Double Medical i.e., Double Medical and Longjian Road go up and down completely randomly.
Pair Corralation between Double Medical and Longjian Road
Assuming the 90 days trading horizon Double Medical Technology is expected to under-perform the Longjian Road. But the stock apears to be less risky and, when comparing its historical volatility, Double Medical Technology is 1.02 times less risky than Longjian Road. The stock trades about -0.13 of its potential returns per unit of risk. The Longjian Road Bridge is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 381.00 in Longjian Road Bridge on August 28, 2024 and sell it today you would lose (6.00) from holding Longjian Road Bridge or give up 1.57% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Double Medical Technology vs. Longjian Road Bridge
Performance |
| Timeline |
| Double Medical Technology |
| Longjian Road Bridge |
Double Medical and Longjian Road Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Double Medical and Longjian Road
The main advantage of trading using opposite Double Medical and Longjian Road positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Double Medical position performs unexpectedly, Longjian Road 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 Longjian Road will offset losses from the drop in Longjian Road's long position.| Double Medical vs. Dazhong Transportation Group | Double Medical vs. Lander Sports Development | Double Medical vs. Kingsignal Technology Co | Double Medical vs. Jiugui Liquor Co |
| Longjian Road vs. Guangzhou Jinyi Media | Longjian Road vs. Nexchip Semiconductor Corp | Longjian Road vs. Northern United Publishing | Longjian Road vs. Sportsoul Co Ltd |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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