Correlation Between GlaxoSmithKline PLC and Lizhi
Can any of the company-specific risk be diversified away by investing in both GlaxoSmithKline PLC and Lizhi 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 GlaxoSmithKline PLC and Lizhi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GlaxoSmithKline PLC ADR and Lizhi Inc, you can compare the effects of market volatilities on GlaxoSmithKline PLC and Lizhi 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 GlaxoSmithKline PLC with a short position of Lizhi. Check out your portfolio center. Please also check ongoing floating volatility patterns of GlaxoSmithKline PLC and Lizhi.
Diversification Opportunities for GlaxoSmithKline PLC and Lizhi
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between GlaxoSmithKline and Lizhi is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding GlaxoSmithKline PLC ADR and Lizhi Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lizhi Inc and GlaxoSmithKline PLC 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 GlaxoSmithKline PLC ADR are associated (or correlated) with Lizhi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lizhi Inc has no effect on the direction of GlaxoSmithKline PLC i.e., GlaxoSmithKline PLC and Lizhi go up and down completely randomly.
Pair Corralation between GlaxoSmithKline PLC and Lizhi
If you would invest 80.00 in Lizhi Inc on August 27, 2024 and sell it today you would earn a total of 0.00 from holding Lizhi Inc or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
GlaxoSmithKline PLC ADR vs. Lizhi Inc
Performance |
| Timeline |
| GlaxoSmithKline PLC ADR |
| Lizhi Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
GlaxoSmithKline PLC and Lizhi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GlaxoSmithKline PLC and Lizhi
The main advantage of trading using opposite GlaxoSmithKline PLC and Lizhi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GlaxoSmithKline PLC position performs unexpectedly, Lizhi 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 Lizhi will offset losses from the drop in Lizhi's long position.| GlaxoSmithKline PLC vs. Novartis AG ADR | GlaxoSmithKline PLC vs. AstraZeneca PLC ADR | GlaxoSmithKline PLC vs. Roche Holding Ltd | GlaxoSmithKline PLC vs. Bristol Myers Squibb |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
Other Complementary Tools
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency |