Correlation Between AIR LIQUIDE and Ganfeng Lithium
Can any of the company-specific risk be diversified away by investing in both AIR LIQUIDE and Ganfeng Lithium at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining AIR LIQUIDE and Ganfeng Lithium into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AIR LIQUIDE ADR and Ganfeng Lithium Co, you can compare the effects of market volatilities on AIR LIQUIDE and Ganfeng Lithium 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 AIR LIQUIDE with a short position of Ganfeng Lithium. Check out your portfolio center. Please also check ongoing floating volatility patterns of AIR LIQUIDE and Ganfeng Lithium.
Diversification Opportunities for AIR LIQUIDE and Ganfeng Lithium
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between AIR and Ganfeng is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding AIR LIQUIDE ADR and Ganfeng Lithium Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ganfeng Lithium and AIR LIQUIDE 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 AIR LIQUIDE ADR are associated (or correlated) with Ganfeng Lithium. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ganfeng Lithium has no effect on the direction of AIR LIQUIDE i.e., AIR LIQUIDE and Ganfeng Lithium go up and down completely randomly.
Pair Corralation between AIR LIQUIDE and Ganfeng Lithium
Assuming the 90 days trading horizon AIR LIQUIDE ADR is expected to under-perform the Ganfeng Lithium. But the stock apears to be less risky and, when comparing its historical volatility, AIR LIQUIDE ADR is 3.6 times less risky than Ganfeng Lithium. The stock trades about -0.03 of its potential returns per unit of risk. The Ganfeng Lithium Co is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 256.00 in Ganfeng Lithium Co on October 31, 2024 and sell it today you would lose (18.00) from holding Ganfeng Lithium Co or give up 7.03% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AIR LIQUIDE ADR vs. Ganfeng Lithium Co
Performance |
| Timeline |
| AIR LIQUIDE ADR |
| Ganfeng Lithium |
AIR LIQUIDE and Ganfeng Lithium Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AIR LIQUIDE and Ganfeng Lithium
The main advantage of trading using opposite AIR LIQUIDE and Ganfeng Lithium positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AIR LIQUIDE position performs unexpectedly, Ganfeng Lithium 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 Ganfeng Lithium will offset losses from the drop in Ganfeng Lithium's long position.| AIR LIQUIDE vs. Sixt Leasing SE | AIR LIQUIDE vs. LOANDEPOT INC A | AIR LIQUIDE vs. SALESFORCE INC CDR | AIR LIQUIDE vs. ZhongAn Online P |
| Ganfeng Lithium vs. AIR LIQUIDE ADR | Ganfeng Lithium vs. Air Products and | Ganfeng Lithium vs. Shin Etsu Chemical Co | Ganfeng Lithium vs. BASF SE |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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