Correlation Between Finetechnix CoLtd and LX Semicon
Can any of the company-specific risk be diversified away by investing in both Finetechnix CoLtd and LX Semicon at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Finetechnix CoLtd and LX Semicon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Finetechnix CoLtd and LX Semicon Co, you can compare the effects of market volatilities on Finetechnix CoLtd and LX Semicon 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 Finetechnix CoLtd with a short position of LX Semicon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Finetechnix CoLtd and LX Semicon.
Diversification Opportunities for Finetechnix CoLtd and LX Semicon
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Finetechnix and 108320 is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Finetechnix CoLtd and LX Semicon Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LX Semicon and Finetechnix CoLtd 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 Finetechnix CoLtd are associated (or correlated) with LX Semicon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LX Semicon has no effect on the direction of Finetechnix CoLtd i.e., Finetechnix CoLtd and LX Semicon go up and down completely randomly.
Pair Corralation between Finetechnix CoLtd and LX Semicon
Assuming the 90 days trading horizon Finetechnix CoLtd is expected to generate 1.49 times more return on investment than LX Semicon. However, Finetechnix CoLtd is 1.49 times more volatile than LX Semicon Co. It trades about -0.01 of its potential returns per unit of risk. LX Semicon Co is currently generating about -0.02 per unit of risk. If you would invest 262,500 in Finetechnix CoLtd on November 1, 2024 and sell it today you would lose (109,800) from holding Finetechnix CoLtd or give up 41.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Finetechnix CoLtd vs. LX Semicon Co
Performance |
| Timeline |
| Finetechnix CoLtd |
| LX Semicon |
Finetechnix CoLtd and LX Semicon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Finetechnix CoLtd and LX Semicon
The main advantage of trading using opposite Finetechnix CoLtd and LX Semicon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Finetechnix CoLtd position performs unexpectedly, LX Semicon 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 LX Semicon will offset losses from the drop in LX Semicon's long position.| Finetechnix CoLtd vs. Sempio Foods Co | Finetechnix CoLtd vs. Samlip General Foods | Finetechnix CoLtd vs. Hyundai Green Food | Finetechnix CoLtd vs. FOODWELL Co |
| LX Semicon vs. GS Retail Co | LX Semicon vs. SS TECH | LX Semicon vs. LG Household Healthcare | LX Semicon vs. PH Tech 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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