Correlation Between Industrial and Lutian Machinery
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By analyzing existing cross correlation between Industrial and Commercial and Lutian Machinery Co, you can compare the effects of market volatilities on Industrial and Lutian Machinery 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 Industrial with a short position of Lutian Machinery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Industrial and Lutian Machinery.
Diversification Opportunities for Industrial and Lutian Machinery
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Industrial and Lutian is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Industrial and Commercial and Lutian Machinery Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lutian Machinery and Industrial 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 Industrial and Commercial are associated (or correlated) with Lutian Machinery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lutian Machinery has no effect on the direction of Industrial i.e., Industrial and Lutian Machinery go up and down completely randomly.
Pair Corralation between Industrial and Lutian Machinery
Assuming the 90 days trading horizon Industrial and Commercial is expected to generate 0.83 times more return on investment than Lutian Machinery. However, Industrial and Commercial is 1.21 times less risky than Lutian Machinery. It trades about 0.17 of its potential returns per unit of risk. Lutian Machinery Co is currently generating about 0.0 per unit of risk. If you would invest 607.00 in Industrial and Commercial on October 26, 2024 and sell it today you would earn a total of 59.00 from holding Industrial and Commercial or generate 9.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Industrial and Commercial vs. Lutian Machinery Co
Performance |
| Timeline |
| Industrial and Commercial |
| Lutian Machinery |
Industrial and Lutian Machinery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Industrial and Lutian Machinery
The main advantage of trading using opposite Industrial and Lutian Machinery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Industrial position performs unexpectedly, Lutian Machinery 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 Lutian Machinery will offset losses from the drop in Lutian Machinery's long position.| Industrial vs. Sino Platinum Metals Co | Industrial vs. Offshore Oil Engineering | Industrial vs. Heilongjiang Transport Development | Industrial vs. Qingdao Haier Biomedical |
| Lutian Machinery vs. PetroChina Co Ltd | Lutian Machinery vs. Industrial and Commercial | Lutian Machinery vs. China Petroleum Chemical | Lutian Machinery vs. China Construction Bank |
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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