Correlation Between Xiamen East and Loctek Ergonomic
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By analyzing existing cross correlation between Xiamen East Asia and Loctek Ergonomic Technology, you can compare the effects of market volatilities on Xiamen East and Loctek Ergonomic 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 Xiamen East with a short position of Loctek Ergonomic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiamen East and Loctek Ergonomic.
Diversification Opportunities for Xiamen East and Loctek Ergonomic
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Xiamen and Loctek is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Xiamen East Asia and Loctek Ergonomic Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Loctek Ergonomic Tec and Xiamen East 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 Xiamen East Asia are associated (or correlated) with Loctek Ergonomic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Loctek Ergonomic Tec has no effect on the direction of Xiamen East i.e., Xiamen East and Loctek Ergonomic go up and down completely randomly.
Pair Corralation between Xiamen East and Loctek Ergonomic
Assuming the 90 days trading horizon Xiamen East Asia is expected to generate 1.13 times more return on investment than Loctek Ergonomic. However, Xiamen East is 1.13 times more volatile than Loctek Ergonomic Technology. It trades about 0.06 of its potential returns per unit of risk. Loctek Ergonomic Technology is currently generating about 0.04 per unit of risk. If you would invest 917.00 in Xiamen East Asia on August 28, 2024 and sell it today you would earn a total of 156.00 from holding Xiamen East Asia or generate 17.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xiamen East Asia vs. Loctek Ergonomic Technology
Performance |
| Timeline |
| Xiamen East Asia |
| Loctek Ergonomic Tec |
Xiamen East and Loctek Ergonomic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiamen East and Loctek Ergonomic
The main advantage of trading using opposite Xiamen East and Loctek Ergonomic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiamen East position performs unexpectedly, Loctek Ergonomic 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 Loctek Ergonomic will offset losses from the drop in Loctek Ergonomic's long position.| Xiamen East vs. Jinhui Mining Co | Xiamen East vs. Zhengzhou Coal Mining | Xiamen East vs. Bus Online Co | Xiamen East vs. Xiangyang Automobile Bearing |
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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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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