Correlation Between Lepu Medical and Shanghai Action
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By analyzing existing cross correlation between Lepu Medical Tech and Shanghai Action Education, you can compare the effects of market volatilities on Lepu Medical and Shanghai Action 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 Lepu Medical with a short position of Shanghai Action. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lepu Medical and Shanghai Action.
Diversification Opportunities for Lepu Medical and Shanghai Action
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Lepu and Shanghai is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Lepu Medical Tech and Shanghai Action Education in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Action Education and Lepu 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 Lepu Medical Tech are associated (or correlated) with Shanghai Action. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Action Education has no effect on the direction of Lepu Medical i.e., Lepu Medical and Shanghai Action go up and down completely randomly.
Pair Corralation between Lepu Medical and Shanghai Action
Assuming the 90 days trading horizon Lepu Medical Tech is expected to under-perform the Shanghai Action. But the stock apears to be less risky and, when comparing its historical volatility, Lepu Medical Tech is 2.34 times less risky than Shanghai Action. The stock trades about -0.06 of its potential returns per unit of risk. The Shanghai Action Education is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 3,306 in Shanghai Action Education on September 28, 2024 and sell it today you would earn a total of 102.00 from holding Shanghai Action Education or generate 3.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lepu Medical Tech vs. Shanghai Action Education
Performance |
| Timeline |
| Lepu Medical Tech |
| Shanghai Action Education |
Lepu Medical and Shanghai Action Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lepu Medical and Shanghai Action
The main advantage of trading using opposite Lepu Medical and Shanghai Action positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lepu Medical position performs unexpectedly, Shanghai Action 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 Shanghai Action will offset losses from the drop in Shanghai Action's long position.| Lepu Medical vs. New China Life | Lepu Medical vs. Ming Yang Smart | Lepu Medical vs. 159681 | Lepu Medical vs. 159005 |
| Shanghai Action vs. PetroChina Co Ltd | Shanghai Action vs. China Mobile Limited | Shanghai Action vs. CNOOC Limited | Shanghai Action vs. Ping An Insurance |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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