Correlation Between Lotus Health and Longjian Road
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By analyzing existing cross correlation between Lotus Health Group and Longjian Road Bridge, you can compare the effects of market volatilities on Lotus Health and Longjian Road 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 Longjian Road. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lotus Health and Longjian Road.
Diversification Opportunities for Lotus Health and Longjian Road
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Lotus and Longjian is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Lotus Health Group and Longjian Road Bridge in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Longjian Road Bridge 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 Longjian Road. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Longjian Road Bridge has no effect on the direction of Lotus Health i.e., Lotus Health and Longjian Road go up and down completely randomly.
Pair Corralation between Lotus Health and Longjian Road
Assuming the 90 days trading horizon Lotus Health Group is expected to generate 1.02 times more return on investment than Longjian Road. However, Lotus Health is 1.02 times more volatile than Longjian Road Bridge. It trades about 0.06 of its potential returns per unit of risk. Longjian Road Bridge is currently generating about 0.03 per unit of risk. If you would invest 293.00 in Lotus Health Group on September 3, 2024 and sell it today you would earn a total of 237.00 from holding Lotus Health Group or generate 80.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lotus Health Group vs. Longjian Road Bridge
Performance |
| Timeline |
| Lotus Health Group |
| Longjian Road Bridge |
Lotus Health and Longjian Road Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lotus Health and Longjian Road
The main advantage of trading using opposite Lotus Health and Longjian Road positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lotus Health position performs unexpectedly, Longjian Road 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 Longjian Road will offset losses from the drop in Longjian Road'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 |
| Longjian Road vs. Cultural Investment Holdings | Longjian Road vs. Gome Telecom Equipment | Longjian Road vs. Bus Online Co | Longjian Road vs. Holitech Technology Co |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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