Correlation Between Loctek Ergonomic and Guangdong Xiongsu
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By analyzing existing cross correlation between Loctek Ergonomic Technology and Guangdong Xiongsu Technology, you can compare the effects of market volatilities on Loctek Ergonomic and Guangdong Xiongsu 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 Xiongsu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Loctek Ergonomic and Guangdong Xiongsu.
Diversification Opportunities for Loctek Ergonomic and Guangdong Xiongsu
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Loctek and Guangdong is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Loctek Ergonomic Technology and Guangdong Xiongsu Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Xiongsu 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 Xiongsu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Xiongsu has no effect on the direction of Loctek Ergonomic i.e., Loctek Ergonomic and Guangdong Xiongsu go up and down completely randomly.
Pair Corralation between Loctek Ergonomic and Guangdong Xiongsu
Assuming the 90 days trading horizon Loctek Ergonomic Technology is expected to generate 0.76 times more return on investment than Guangdong Xiongsu. However, Loctek Ergonomic Technology is 1.32 times less risky than Guangdong Xiongsu. It trades about 0.02 of its potential returns per unit of risk. Guangdong Xiongsu Technology is currently generating about 0.01 per unit of risk. If you would invest 1,404 in Loctek Ergonomic Technology on October 27, 2024 and sell it today you would earn a total of 89.00 from holding Loctek Ergonomic Technology or generate 6.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.64% |
| Values | Daily Returns |
Loctek Ergonomic Technology vs. Guangdong Xiongsu Technology
Performance |
| Timeline |
| Loctek Ergonomic Tec |
| Guangdong Xiongsu |
Loctek Ergonomic and Guangdong Xiongsu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Loctek Ergonomic and Guangdong Xiongsu
The main advantage of trading using opposite Loctek Ergonomic and Guangdong Xiongsu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Loctek Ergonomic position performs unexpectedly, Guangdong Xiongsu 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 Xiongsu will offset losses from the drop in Guangdong Xiongsu's long position.| Loctek Ergonomic vs. Shenzhen Urban Transport | Loctek Ergonomic vs. Union Semiconductor Co | Loctek Ergonomic vs. Zhejiang Kingland Pipeline | Loctek Ergonomic vs. Thinkon Semiconductor Jinzhou |
| Guangdong Xiongsu vs. Anhui Fuhuang Steel | Guangdong Xiongsu vs. Road Environment Technology | Guangdong Xiongsu vs. Hangzhou Guotai Environmental | Guangdong Xiongsu vs. Eit Environmental Development |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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