Correlation Between Lindeman Asia and CS BEARING
Can any of the company-specific risk be diversified away by investing in both Lindeman Asia and CS BEARING 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 Lindeman Asia and CS BEARING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lindeman Asia Investment and CS BEARING CoLtd, you can compare the effects of market volatilities on Lindeman Asia and CS BEARING 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 Lindeman Asia with a short position of CS BEARING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lindeman Asia and CS BEARING.
Diversification Opportunities for Lindeman Asia and CS BEARING
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lindeman and 297090 is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Lindeman Asia Investment and CS BEARING CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CS BEARING CoLtd and Lindeman Asia 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 Lindeman Asia Investment are associated (or correlated) with CS BEARING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CS BEARING CoLtd has no effect on the direction of Lindeman Asia i.e., Lindeman Asia and CS BEARING go up and down completely randomly.
Pair Corralation between Lindeman Asia and CS BEARING
Assuming the 90 days trading horizon Lindeman Asia Investment is expected to generate 1.05 times more return on investment than CS BEARING. However, Lindeman Asia is 1.05 times more volatile than CS BEARING CoLtd. It trades about -0.18 of its potential returns per unit of risk. CS BEARING CoLtd is currently generating about -0.38 per unit of risk. If you would invest 404,000 in Lindeman Asia Investment on August 25, 2024 and sell it today you would lose (56,000) from holding Lindeman Asia Investment or give up 13.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lindeman Asia Investment vs. CS BEARING CoLtd
Performance |
| Timeline |
| Lindeman Asia Investment |
| CS BEARING CoLtd |
Lindeman Asia and CS BEARING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lindeman Asia and CS BEARING
The main advantage of trading using opposite Lindeman Asia and CS BEARING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lindeman Asia position performs unexpectedly, CS BEARING 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 CS BEARING will offset losses from the drop in CS BEARING's long position.| Lindeman Asia vs. Nh Investment And | Lindeman Asia vs. DSC Investment | Lindeman Asia vs. YeSUN Tech CoLtd |
| CS BEARING vs. Hanwha InvestmentSecurities Co | CS BEARING vs. FOODWELL Co | CS BEARING vs. Stic Investments | CS BEARING vs. Lindeman Asia Investment |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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