Correlation Between LANSON-BCC INH and Origin Agritech
Can any of the company-specific risk be diversified away by investing in both LANSON-BCC INH and Origin Agritech 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 LANSON-BCC INH and Origin Agritech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LANSON BCC INH EO and Origin Agritech, you can compare the effects of market volatilities on LANSON-BCC INH and Origin Agritech 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 LANSON-BCC INH with a short position of Origin Agritech. Check out your portfolio center. Please also check ongoing floating volatility patterns of LANSON-BCC INH and Origin Agritech.
Diversification Opportunities for LANSON-BCC INH and Origin Agritech
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between LANSON-BCC and Origin is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding LANSON BCC INH EO and Origin Agritech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Origin Agritech and LANSON-BCC INH 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 LANSON BCC INH EO are associated (or correlated) with Origin Agritech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Origin Agritech has no effect on the direction of LANSON-BCC INH i.e., LANSON-BCC INH and Origin Agritech go up and down completely randomly.
Pair Corralation between LANSON-BCC INH and Origin Agritech
Assuming the 90 days horizon LANSON BCC INH EO is expected to generate 0.28 times more return on investment than Origin Agritech. However, LANSON BCC INH EO is 3.54 times less risky than Origin Agritech. It trades about -0.48 of its potential returns per unit of risk. Origin Agritech is currently generating about -0.16 per unit of risk. If you would invest 3,940 in LANSON BCC INH EO on August 25, 2024 and sell it today you would lose (440.00) from holding LANSON BCC INH EO or give up 11.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
LANSON BCC INH EO vs. Origin Agritech
Performance |
| Timeline |
| LANSON BCC INH |
| Origin Agritech |
LANSON-BCC INH and Origin Agritech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LANSON-BCC INH and Origin Agritech
The main advantage of trading using opposite LANSON-BCC INH and Origin Agritech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LANSON-BCC INH position performs unexpectedly, Origin Agritech 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 Origin Agritech will offset losses from the drop in Origin Agritech's long position.| LANSON-BCC INH vs. Perdoceo Education | LANSON-BCC INH vs. Q2M Managementberatung AG | LANSON-BCC INH vs. Tencent Music Entertainment | LANSON-BCC INH vs. Addus HomeCare |
| Origin Agritech vs. Mizuho Financial Group | Origin Agritech vs. Mitsui Chemicals | Origin Agritech vs. PT Bank Maybank | Origin Agritech vs. REVO INSURANCE SPA |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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