Correlation Between Lotus Health and Shenzhen Changfang
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By analyzing existing cross correlation between Lotus Health Group and Shenzhen Changfang Light, you can compare the effects of market volatilities on Lotus Health and Shenzhen Changfang 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 Shenzhen Changfang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lotus Health and Shenzhen Changfang.
Diversification Opportunities for Lotus Health and Shenzhen Changfang
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Lotus and Shenzhen is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Lotus Health Group and Shenzhen Changfang Light in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Changfang Light 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 Shenzhen Changfang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Changfang Light has no effect on the direction of Lotus Health i.e., Lotus Health and Shenzhen Changfang go up and down completely randomly.
Pair Corralation between Lotus Health and Shenzhen Changfang
Assuming the 90 days trading horizon Lotus Health Group is expected to generate 2.16 times more return on investment than Shenzhen Changfang. However, Lotus Health is 2.16 times more volatile than Shenzhen Changfang Light. It trades about 0.08 of its potential returns per unit of risk. Shenzhen Changfang Light is currently generating about 0.14 per unit of risk. If you would invest 490.00 in Lotus Health Group on October 28, 2024 and sell it today you would earn a total of 34.00 from holding Lotus Health Group or generate 6.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lotus Health Group vs. Shenzhen Changfang Light
Performance |
| Timeline |
| Lotus Health Group |
| Shenzhen Changfang Light |
Lotus Health and Shenzhen Changfang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lotus Health and Shenzhen Changfang
The main advantage of trading using opposite Lotus Health and Shenzhen Changfang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lotus Health position performs unexpectedly, Shenzhen Changfang 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 Shenzhen Changfang will offset losses from the drop in Shenzhen Changfang's long position.| Lotus Health vs. Kweichow Moutai Co | Lotus Health vs. Contemporary Amperex Technology | Lotus Health vs. G bits Network Technology | Lotus Health vs. Beijing Roborock Technology |
| Shenzhen Changfang vs. Dazhong Transportation Group | Shenzhen Changfang vs. Keda Clean Energy | Shenzhen Changfang vs. Ningbo Kangqiang Electronics | Shenzhen Changfang vs. LianChuang Electronic Technology |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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