Correlation Between Sinosteel Luonai and Luolai Home
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By analyzing existing cross correlation between Sinosteel Luonai Materials and Luolai Home Textile, you can compare the effects of market volatilities on Sinosteel Luonai and Luolai Home 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 Sinosteel Luonai with a short position of Luolai Home. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sinosteel Luonai and Luolai Home.
Diversification Opportunities for Sinosteel Luonai and Luolai Home
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sinosteel and Luolai is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Sinosteel Luonai Materials and Luolai Home Textile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Luolai Home Textile and Sinosteel Luonai 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 Sinosteel Luonai Materials are associated (or correlated) with Luolai Home. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Luolai Home Textile has no effect on the direction of Sinosteel Luonai i.e., Sinosteel Luonai and Luolai Home go up and down completely randomly.
Pair Corralation between Sinosteel Luonai and Luolai Home
Assuming the 90 days trading horizon Sinosteel Luonai Materials is expected to under-perform the Luolai Home. In addition to that, Sinosteel Luonai is 1.39 times more volatile than Luolai Home Textile. It trades about -0.08 of its total potential returns per unit of risk. Luolai Home Textile is currently generating about 0.03 per unit of volatility. If you would invest 830.00 in Luolai Home Textile on January 24, 2025 and sell it today you would earn a total of 7.00 from holding Luolai Home Textile or generate 0.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sinosteel Luonai Materials vs. Luolai Home Textile
Performance |
| Timeline |
| Sinosteel Luonai Mat |
| Luolai Home Textile |
Sinosteel Luonai and Luolai Home Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sinosteel Luonai and Luolai Home
The main advantage of trading using opposite Sinosteel Luonai and Luolai Home positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sinosteel Luonai position performs unexpectedly, Luolai Home 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 Luolai Home will offset losses from the drop in Luolai Home's long position.| Sinosteel Luonai vs. Western Metal Materials | Sinosteel Luonai vs. Rising Nonferrous Metals | Sinosteel Luonai vs. Hygon Information Technology | Sinosteel Luonai vs. Ye Chiu Metal |
| Luolai Home vs. China Petroleum Chemical | Luolai Home vs. PetroChina Co Ltd | Luolai Home vs. China State Construction | Luolai Home vs. China Railway Construction |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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