Correlation Between Dorel Industries and Lotus Technology
Can any of the company-specific risk be diversified away by investing in both Dorel Industries and Lotus Technology 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 Dorel Industries and Lotus Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dorel Industries and Lotus Technology Warrants, you can compare the effects of market volatilities on Dorel Industries and Lotus Technology 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 Dorel Industries with a short position of Lotus Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dorel Industries and Lotus Technology.
Diversification Opportunities for Dorel Industries and Lotus Technology
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Dorel and Lotus is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Dorel Industries and Lotus Technology Warrants in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lotus Technology Warrants and Dorel Industries 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 Dorel Industries are associated (or correlated) with Lotus Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lotus Technology Warrants has no effect on the direction of Dorel Industries i.e., Dorel Industries and Lotus Technology go up and down completely randomly.
Pair Corralation between Dorel Industries and Lotus Technology
If you would invest 27.00 in Lotus Technology Warrants on August 28, 2024 and sell it today you would earn a total of 1.00 from holding Lotus Technology Warrants or generate 3.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 7.69% |
| Values | Daily Returns |
Dorel Industries vs. Lotus Technology Warrants
Performance |
| Timeline |
| Dorel Industries |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Lotus Technology Warrants |
Dorel Industries and Lotus Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dorel Industries and Lotus Technology
The main advantage of trading using opposite Dorel Industries and Lotus Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dorel Industries position performs unexpectedly, Lotus Technology 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 Lotus Technology will offset losses from the drop in Lotus Technology's long position.| Dorel Industries vs. Flexsteel Industries | Dorel Industries vs. Energy Focu | Dorel Industries vs. Hamilton Beach Brands | Dorel Industries vs. Bassett Furniture Industries |
| Lotus Technology vs. F PD | Lotus Technology vs. China Yuchai International | Lotus Technology vs. Canoo Holdings |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
Other Complementary Tools
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance |