Correlation Between Lotus Health and Huatian Hotel
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By analyzing existing cross correlation between Lotus Health Group and Huatian Hotel Group, you can compare the effects of market volatilities on Lotus Health and Huatian Hotel 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 Lotus Health with a short position of Huatian Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lotus Health and Huatian Hotel.
Diversification Opportunities for Lotus Health and Huatian Hotel
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Lotus and Huatian is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Lotus Health Group and Huatian Hotel Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huatian Hotel Group and Lotus Health 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 Lotus Health Group are associated (or correlated) with Huatian Hotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huatian Hotel Group has no effect on the direction of Lotus Health i.e., Lotus Health and Huatian Hotel go up and down completely randomly.
Pair Corralation between Lotus Health and Huatian Hotel
Assuming the 90 days trading horizon Lotus Health Group is expected to generate 1.0 times more return on investment than Huatian Hotel. However, Lotus Health Group is 1.0 times less risky than Huatian Hotel. It trades about 0.2 of its potential returns per unit of risk. Huatian Hotel Group is currently generating about 0.02 per unit of risk. If you would invest 470.00 in Lotus Health Group on September 3, 2024 and sell it today you would earn a total of 60.00 from holding Lotus Health Group or generate 12.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lotus Health Group vs. Huatian Hotel Group
Performance |
| Timeline |
| Lotus Health Group |
| Huatian Hotel Group |
Lotus Health and Huatian Hotel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lotus Health and Huatian Hotel
The main advantage of trading using opposite Lotus Health and Huatian Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lotus Health position performs unexpectedly, Huatian Hotel 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 Huatian Hotel will offset losses from the drop in Huatian Hotel's long position.| Lotus Health vs. Beijing Wantai Biological | Lotus Health vs. Aluminum Corp of | Lotus Health vs. COL Digital Publishing | Lotus Health vs. Shaanxi Meineng Clean |
| Huatian Hotel vs. PetroChina Co Ltd | Huatian Hotel vs. China Mobile Limited | Huatian Hotel vs. Industrial and Commercial | Huatian Hotel vs. China Life 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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