Correlation Between Lotus Health and Longxing Chemical
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By analyzing existing cross correlation between Lotus Health Group and Longxing Chemical Stock, you can compare the effects of market volatilities on Lotus Health and Longxing Chemical 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 Longxing Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lotus Health and Longxing Chemical.
Diversification Opportunities for Lotus Health and Longxing Chemical
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lotus and Longxing is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Lotus Health Group and Longxing Chemical Stock in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Longxing Chemical Stock 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 Longxing Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Longxing Chemical Stock has no effect on the direction of Lotus Health i.e., Lotus Health and Longxing Chemical go up and down completely randomly.
Pair Corralation between Lotus Health and Longxing Chemical
Assuming the 90 days trading horizon Lotus Health Group is expected to under-perform the Longxing Chemical. In addition to that, Lotus Health is 1.6 times more volatile than Longxing Chemical Stock. It trades about -0.11 of its total potential returns per unit of risk. Longxing Chemical Stock is currently generating about 0.01 per unit of volatility. If you would invest 556.00 in Longxing Chemical Stock on November 4, 2024 and sell it today you would earn a total of 0.00 from holding Longxing Chemical Stock or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lotus Health Group vs. Longxing Chemical Stock
Performance |
| Timeline |
| Lotus Health Group |
| Longxing Chemical Stock |
Lotus Health and Longxing Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lotus Health and Longxing Chemical
The main advantage of trading using opposite Lotus Health and Longxing Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lotus Health position performs unexpectedly, Longxing Chemical 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 Longxing Chemical will offset losses from the drop in Longxing Chemical's long position.| Lotus Health vs. Hubei Tech Semiconductors | Lotus Health vs. Shannon Semiconductor Technology | Lotus Health vs. Semiconductor Manufacturing Intl | Lotus Health vs. Zhejiang Qianjiang Motorcycle |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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