Correlation Between Loctek Ergonomic and Guangdong Tianhe
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By analyzing existing cross correlation between Loctek Ergonomic Technology and Guangdong Tianhe Agricultural, you can compare the effects of market volatilities on Loctek Ergonomic and Guangdong Tianhe 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 Loctek Ergonomic with a short position of Guangdong Tianhe. Check out your portfolio center. Please also check ongoing floating volatility patterns of Loctek Ergonomic and Guangdong Tianhe.
Diversification Opportunities for Loctek Ergonomic and Guangdong Tianhe
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Loctek and Guangdong is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Loctek Ergonomic Technology and Guangdong Tianhe Agricultural in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Tianhe Agr and Loctek Ergonomic 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 Loctek Ergonomic Technology are associated (or correlated) with Guangdong Tianhe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Tianhe Agr has no effect on the direction of Loctek Ergonomic i.e., Loctek Ergonomic and Guangdong Tianhe go up and down completely randomly.
Pair Corralation between Loctek Ergonomic and Guangdong Tianhe
Assuming the 90 days trading horizon Loctek Ergonomic Technology is expected to under-perform the Guangdong Tianhe. But the stock apears to be less risky and, when comparing its historical volatility, Loctek Ergonomic Technology is 1.48 times less risky than Guangdong Tianhe. The stock trades about -0.14 of its potential returns per unit of risk. The Guangdong Tianhe Agricultural is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 633.00 in Guangdong Tianhe Agricultural on September 25, 2024 and sell it today you would lose (26.00) from holding Guangdong Tianhe Agricultural or give up 4.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Loctek Ergonomic Technology vs. Guangdong Tianhe Agricultural
Performance |
| Timeline |
| Loctek Ergonomic Tec |
| Guangdong Tianhe Agr |
Loctek Ergonomic and Guangdong Tianhe Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Loctek Ergonomic and Guangdong Tianhe
The main advantage of trading using opposite Loctek Ergonomic and Guangdong Tianhe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Loctek Ergonomic position performs unexpectedly, Guangdong Tianhe 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 Guangdong Tianhe will offset losses from the drop in Guangdong Tianhe's long position.| Loctek Ergonomic vs. Ming Yang Smart | Loctek Ergonomic vs. 159681 | Loctek Ergonomic vs. 159005 | Loctek Ergonomic vs. Yes Optoelectronics Co |
| Guangdong Tianhe vs. Zijin Mining Group | Guangdong Tianhe vs. Wanhua Chemical Group | Guangdong Tianhe vs. Baoshan Iron Steel | Guangdong Tianhe vs. Shandong Gold Mining |
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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