Correlation Between Lutian Machinery and Xinjiang Tianrun
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By analyzing existing cross correlation between Lutian Machinery Co and Xinjiang Tianrun Dairy, you can compare the effects of market volatilities on Lutian Machinery and Xinjiang Tianrun 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 Xinjiang Tianrun. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lutian Machinery and Xinjiang Tianrun.
Diversification Opportunities for Lutian Machinery and Xinjiang Tianrun
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Lutian and Xinjiang is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Lutian Machinery Co and Xinjiang Tianrun Dairy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinjiang Tianrun Dairy 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 Xinjiang Tianrun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinjiang Tianrun Dairy has no effect on the direction of Lutian Machinery i.e., Lutian Machinery and Xinjiang Tianrun go up and down completely randomly.
Pair Corralation between Lutian Machinery and Xinjiang Tianrun
Assuming the 90 days trading horizon Lutian Machinery Co is expected to generate 1.09 times more return on investment than Xinjiang Tianrun. However, Lutian Machinery is 1.09 times more volatile than Xinjiang Tianrun Dairy. It trades about 0.01 of its potential returns per unit of risk. Xinjiang Tianrun Dairy is currently generating about -0.04 per unit of risk. If you would invest 1,540 in Lutian Machinery Co on September 2, 2024 and sell it today you would earn a total of 23.00 from holding Lutian Machinery Co or generate 1.49% 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. Xinjiang Tianrun Dairy
Performance |
| Timeline |
| Lutian Machinery |
| Xinjiang Tianrun Dairy |
Lutian Machinery and Xinjiang Tianrun Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lutian Machinery and Xinjiang Tianrun
The main advantage of trading using opposite Lutian Machinery and Xinjiang Tianrun positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lutian Machinery position performs unexpectedly, Xinjiang Tianrun 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 Xinjiang Tianrun will offset losses from the drop in Xinjiang Tianrun'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 |
| Xinjiang Tianrun vs. Jiangxi JDL Environmental | Xinjiang Tianrun vs. Jiugui Liquor Co | Xinjiang Tianrun vs. Guangzhou Tinci Materials | Xinjiang Tianrun vs. Tongxing Environmental Protection |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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