Correlation Between Lutian Machinery and Metro Investment
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By analyzing existing cross correlation between Lutian Machinery Co and Metro Investment Development, you can compare the effects of market volatilities on Lutian Machinery and Metro 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 Lutian Machinery with a short position of Metro Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lutian Machinery and Metro Investment.
Diversification Opportunities for Lutian Machinery and Metro Investment
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Lutian and Metro is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Lutian Machinery Co and Metro Investment Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Metro Investment Dev 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 Metro Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Metro Investment Dev has no effect on the direction of Lutian Machinery i.e., Lutian Machinery and Metro Investment go up and down completely randomly.
Pair Corralation between Lutian Machinery and Metro Investment
Assuming the 90 days trading horizon Lutian Machinery Co is expected to under-perform the Metro Investment. But the stock apears to be less risky and, when comparing its historical volatility, Lutian Machinery Co is 1.8 times less risky than Metro Investment. The stock trades about -0.01 of its potential returns per unit of risk. The Metro Investment Development is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 473.00 in Metro Investment Development on October 18, 2024 and sell it today you would lose (98.00) from holding Metro Investment Development or give up 20.72% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lutian Machinery Co vs. Metro Investment Development
Performance |
| Timeline |
| Lutian Machinery |
| Metro Investment Dev |
Lutian Machinery and Metro Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lutian Machinery and Metro Investment
The main advantage of trading using opposite Lutian Machinery and Metro Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lutian Machinery position performs unexpectedly, Metro 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 Metro Investment will offset losses from the drop in Metro Investment's long position.| Lutian Machinery vs. City Development Environment | Lutian Machinery vs. Guangdong Liantai Environmental | Lutian Machinery vs. Shenzhen MYS Environmental | Lutian Machinery vs. Anyang Iron Steel |
| Metro Investment vs. Lutian Machinery Co | Metro Investment vs. Shantui Construction Machinery | Metro Investment vs. Linzhou Heavy Machinery | Metro Investment vs. Huasi Agricultural Development |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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