Correlation Between Guangdong Liantai and Luyin Investment
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By analyzing existing cross correlation between Guangdong Liantai Environmental and Luyin Investment Group, you can compare the effects of market volatilities on Guangdong Liantai and Luyin Investment 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 Guangdong Liantai with a short position of Luyin Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Liantai and Luyin Investment.
Diversification Opportunities for Guangdong Liantai and Luyin Investment
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Guangdong and Luyin is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Liantai Environmenta and Luyin Investment Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Luyin Investment and Guangdong Liantai 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 Guangdong Liantai Environmental are associated (or correlated) with Luyin Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Luyin Investment has no effect on the direction of Guangdong Liantai i.e., Guangdong Liantai and Luyin Investment go up and down completely randomly.
Pair Corralation between Guangdong Liantai and Luyin Investment
Assuming the 90 days trading horizon Guangdong Liantai Environmental is expected to generate 0.89 times more return on investment than Luyin Investment. However, Guangdong Liantai Environmental is 1.12 times less risky than Luyin Investment. It trades about 0.25 of its potential returns per unit of risk. Luyin Investment Group is currently generating about 0.13 per unit of risk. If you would invest 407.00 in Guangdong Liantai Environmental on September 15, 2024 and sell it today you would earn a total of 39.00 from holding Guangdong Liantai Environmental or generate 9.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangdong Liantai Environmenta vs. Luyin Investment Group
Performance |
| Timeline |
| Guangdong Liantai |
| Luyin Investment |
Guangdong Liantai and Luyin Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangdong Liantai and Luyin Investment
The main advantage of trading using opposite Guangdong Liantai and Luyin Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Liantai position performs unexpectedly, Luyin Investment 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 Luyin Investment will offset losses from the drop in Luyin Investment's long position.| Guangdong Liantai vs. Shengda Mining Co | Guangdong Liantai vs. PKU HealthCare Corp | Guangdong Liantai vs. Meinian Onehealth Healthcare | Guangdong Liantai vs. Yunnan Copper Co |
| Luyin Investment vs. Focus Media Information | Luyin Investment vs. Guangdong Liantai Environmental | Luyin Investment vs. Beijing SPC Environment | Luyin Investment vs. Dawning Information Industry |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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