Correlation Between AJ LUCAS and MONGOLIA ENERG
Can any of the company-specific risk be diversified away by investing in both AJ LUCAS and MONGOLIA ENERG 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 AJ LUCAS and MONGOLIA ENERG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AJ LUCAS GROUP and MONGOLIA ENERG HD 02, you can compare the effects of market volatilities on AJ LUCAS and MONGOLIA ENERG 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 AJ LUCAS with a short position of MONGOLIA ENERG. Check out your portfolio center. Please also check ongoing floating volatility patterns of AJ LUCAS and MONGOLIA ENERG.
Diversification Opportunities for AJ LUCAS and MONGOLIA ENERG
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between FW9 and MONGOLIA is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding AJ LUCAS GROUP and MONGOLIA ENERG HD 02 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MONGOLIA ENERG HD and AJ LUCAS 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 AJ LUCAS GROUP are associated (or correlated) with MONGOLIA ENERG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MONGOLIA ENERG HD has no effect on the direction of AJ LUCAS i.e., AJ LUCAS and MONGOLIA ENERG go up and down completely randomly.
Pair Corralation between AJ LUCAS and MONGOLIA ENERG
Assuming the 90 days horizon AJ LUCAS GROUP is expected to generate 2.68 times more return on investment than MONGOLIA ENERG. However, AJ LUCAS is 2.68 times more volatile than MONGOLIA ENERG HD 02. It trades about 0.05 of its potential returns per unit of risk. MONGOLIA ENERG HD 02 is currently generating about 0.03 per unit of risk. If you would invest 1.90 in AJ LUCAS GROUP on September 13, 2024 and sell it today you would lose (1.85) from holding AJ LUCAS GROUP or give up 97.37% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AJ LUCAS GROUP vs. MONGOLIA ENERG HD 02
Performance |
| Timeline |
| AJ LUCAS GROUP |
| MONGOLIA ENERG HD |
AJ LUCAS and MONGOLIA ENERG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AJ LUCAS and MONGOLIA ENERG
The main advantage of trading using opposite AJ LUCAS and MONGOLIA ENERG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AJ LUCAS position performs unexpectedly, MONGOLIA ENERG 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 MONGOLIA ENERG will offset losses from the drop in MONGOLIA ENERG's long position.| AJ LUCAS vs. Eagle Materials | AJ LUCAS vs. Compagnie Plastic Omnium | AJ LUCAS vs. GOODYEAR T RUBBER | AJ LUCAS vs. Hyster Yale Materials Handling |
| MONGOLIA ENERG vs. Virtus Investment Partners | MONGOLIA ENERG vs. UNIVERSAL MUSIC GROUP | MONGOLIA ENERG vs. CDL INVESTMENT | MONGOLIA ENERG vs. Gladstone Investment |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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