Correlation Between Western Superconducting and Luzhou Lao
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By analyzing existing cross correlation between Western Superconducting Tech and Luzhou Lao Jiao, you can compare the effects of market volatilities on Western Superconducting and Luzhou Lao 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 Western Superconducting with a short position of Luzhou Lao. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Superconducting and Luzhou Lao.
Diversification Opportunities for Western Superconducting and Luzhou Lao
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Western and Luzhou is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Western Superconducting Tech and Luzhou Lao Jiao in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Luzhou Lao Jiao and Western Superconducting 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 Western Superconducting Tech are associated (or correlated) with Luzhou Lao. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Luzhou Lao Jiao has no effect on the direction of Western Superconducting i.e., Western Superconducting and Luzhou Lao go up and down completely randomly.
Pair Corralation between Western Superconducting and Luzhou Lao
Assuming the 90 days trading horizon Western Superconducting Tech is expected to under-perform the Luzhou Lao. In addition to that, Western Superconducting is 1.03 times more volatile than Luzhou Lao Jiao. It trades about -0.21 of its total potential returns per unit of risk. Luzhou Lao Jiao is currently generating about -0.06 per unit of volatility. If you would invest 14,264 in Luzhou Lao Jiao on August 29, 2024 and sell it today you would lose (577.00) from holding Luzhou Lao Jiao or give up 4.05% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Superconducting Tech vs. Luzhou Lao Jiao
Performance |
| Timeline |
| Western Superconducting |
| Luzhou Lao Jiao |
Western Superconducting and Luzhou Lao Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Superconducting and Luzhou Lao
The main advantage of trading using opposite Western Superconducting and Luzhou Lao positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Superconducting position performs unexpectedly, Luzhou Lao 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 Luzhou Lao will offset losses from the drop in Luzhou Lao's long position.| Western Superconducting vs. PetroChina Co Ltd | Western Superconducting vs. China State Construction | Western Superconducting vs. China Mobile Limited | Western Superconducting vs. Industrial and Commercial |
| Luzhou Lao vs. Saurer Intelligent Technology | Luzhou Lao vs. Fiberhome Telecommunication Technologies | Luzhou Lao vs. Jiujiang Shanshui Technology | Luzhou Lao vs. Western Superconducting Tech |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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