Correlation Between Lutian Machinery and GRINM Semiconductor
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By analyzing existing cross correlation between Lutian Machinery Co and GRINM Semiconductor Materials, you can compare the effects of market volatilities on Lutian Machinery and GRINM Semiconductor 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 GRINM Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lutian Machinery and GRINM Semiconductor.
Diversification Opportunities for Lutian Machinery and GRINM Semiconductor
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Lutian and GRINM is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Lutian Machinery Co and GRINM Semiconductor Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GRINM Semiconductor 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 GRINM Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GRINM Semiconductor has no effect on the direction of Lutian Machinery i.e., Lutian Machinery and GRINM Semiconductor go up and down completely randomly.
Pair Corralation between Lutian Machinery and GRINM Semiconductor
Assuming the 90 days trading horizon Lutian Machinery Co is expected to generate 0.81 times more return on investment than GRINM Semiconductor. However, Lutian Machinery Co is 1.24 times less risky than GRINM Semiconductor. It trades about 0.13 of its potential returns per unit of risk. GRINM Semiconductor Materials is currently generating about -0.09 per unit of risk. If you would invest 1,410 in Lutian Machinery Co on August 29, 2024 and sell it today you would earn a total of 105.00 from holding Lutian Machinery Co or generate 7.45% 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. GRINM Semiconductor Materials
Performance |
| Timeline |
| Lutian Machinery |
| GRINM Semiconductor |
Lutian Machinery and GRINM Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lutian Machinery and GRINM Semiconductor
The main advantage of trading using opposite Lutian Machinery and GRINM Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lutian Machinery position performs unexpectedly, GRINM Semiconductor 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 GRINM Semiconductor will offset losses from the drop in GRINM Semiconductor's long position.| Lutian Machinery vs. Biwin Storage Technology | Lutian Machinery vs. PetroChina Co Ltd | Lutian Machinery vs. Industrial and Commercial | Lutian Machinery vs. China Construction Bank |
| GRINM Semiconductor vs. Zhejiang Yayi Metal | GRINM Semiconductor vs. North Huajin Chemical | GRINM Semiconductor vs. Keda Clean Energy | GRINM Semiconductor vs. Jonjee Hi tech Industrial |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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