Correlation Between Changchun Faway and Loctek Ergonomic
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By analyzing existing cross correlation between Changchun Faway Automobile and Loctek Ergonomic Technology, you can compare the effects of market volatilities on Changchun Faway 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 Changchun Faway with a short position of Loctek Ergonomic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Changchun Faway and Loctek Ergonomic.
Diversification Opportunities for Changchun Faway and Loctek Ergonomic
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Changchun and Loctek is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Changchun Faway Automobile 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 Changchun Faway 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 Changchun Faway Automobile 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 Changchun Faway i.e., Changchun Faway and Loctek Ergonomic go up and down completely randomly.
Pair Corralation between Changchun Faway and Loctek Ergonomic
Assuming the 90 days trading horizon Changchun Faway is expected to generate 2.56 times less return on investment than Loctek Ergonomic. But when comparing it to its historical volatility, Changchun Faway Automobile is 1.41 times less risky than Loctek Ergonomic. It trades about 0.02 of its potential returns per unit of risk. Loctek Ergonomic Technology is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,302 in Loctek Ergonomic Technology on August 28, 2024 and sell it today you would earn a total of 425.00 from holding Loctek Ergonomic Technology or generate 32.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Changchun Faway Automobile vs. Loctek Ergonomic Technology
Performance |
| Timeline |
| Changchun Faway Auto |
| Loctek Ergonomic Tec |
Changchun Faway and Loctek Ergonomic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Changchun Faway and Loctek Ergonomic
The main advantage of trading using opposite Changchun Faway and Loctek Ergonomic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Changchun Faway 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.| Changchun Faway vs. Chinese Universe Publishing | Changchun Faway vs. Ningbo Jianan Electronics | Changchun Faway vs. Epoxy Base Electronic | Changchun Faway vs. Changjiang Publishing Media |
| Loctek Ergonomic vs. Leaguer Shenzhen MicroElectronics | Loctek Ergonomic vs. CSSC Offshore Marine | Loctek Ergonomic vs. Kunshan Guoli Electronic | Loctek Ergonomic vs. Easyhome New Retail |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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