Correlation Between Lutian Machinery and Qinghai Huzhu
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By analyzing existing cross correlation between Lutian Machinery Co and Qinghai Huzhu Barley, you can compare the effects of market volatilities on Lutian Machinery and Qinghai Huzhu 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 Lutian Machinery with a short position of Qinghai Huzhu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lutian Machinery and Qinghai Huzhu.
Diversification Opportunities for Lutian Machinery and Qinghai Huzhu
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Lutian and Qinghai is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Lutian Machinery Co and Qinghai Huzhu Barley in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qinghai Huzhu Barley and Lutian Machinery 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 Lutian Machinery Co are associated (or correlated) with Qinghai Huzhu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qinghai Huzhu Barley has no effect on the direction of Lutian Machinery i.e., Lutian Machinery and Qinghai Huzhu go up and down completely randomly.
Pair Corralation between Lutian Machinery and Qinghai Huzhu
Assuming the 90 days trading horizon Lutian Machinery is expected to generate 1.92 times less return on investment than Qinghai Huzhu. But when comparing it to its historical volatility, Lutian Machinery Co is 1.25 times less risky than Qinghai Huzhu. It trades about 0.12 of its potential returns per unit of risk. Qinghai Huzhu Barley is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 1,000.00 in Qinghai Huzhu Barley on September 2, 2024 and sell it today you would earn a total of 102.00 from holding Qinghai Huzhu Barley or generate 10.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lutian Machinery Co vs. Qinghai Huzhu Barley
Performance |
| Timeline |
| Lutian Machinery |
| Qinghai Huzhu Barley |
Lutian Machinery and Qinghai Huzhu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lutian Machinery and Qinghai Huzhu
The main advantage of trading using opposite Lutian Machinery and Qinghai Huzhu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lutian Machinery position performs unexpectedly, Qinghai Huzhu 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 Qinghai Huzhu will offset losses from the drop in Qinghai Huzhu's long position.| Lutian Machinery vs. Hangzhou Gaoxin Rubber | Lutian Machinery vs. Chengtun Mining Group | Lutian Machinery vs. Eastern Air Logistics | Lutian Machinery vs. Suzhou Xingye Material |
| Qinghai Huzhu vs. Olympic Circuit Technology | Qinghai Huzhu vs. Saurer Intelligent Technology | Qinghai Huzhu vs. Dhc Software Co | Qinghai Huzhu vs. Yingde Greatchem Chemicals |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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