Correlation Between Kingfa Science and Lemon Tree
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By analyzing existing cross correlation between Kingfa Science Technology and Lemon Tree Hotels, you can compare the effects of market volatilities on Kingfa Science and Lemon Tree 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 Kingfa Science with a short position of Lemon Tree. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kingfa Science and Lemon Tree.
Diversification Opportunities for Kingfa Science and Lemon Tree
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kingfa and Lemon is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Kingfa Science Technology and Lemon Tree Hotels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lemon Tree Hotels and Kingfa Science 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 Kingfa Science Technology are associated (or correlated) with Lemon Tree. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lemon Tree Hotels has no effect on the direction of Kingfa Science i.e., Kingfa Science and Lemon Tree go up and down completely randomly.
Pair Corralation between Kingfa Science and Lemon Tree
Assuming the 90 days trading horizon Kingfa Science Technology is expected to generate 1.37 times more return on investment than Lemon Tree. However, Kingfa Science is 1.37 times more volatile than Lemon Tree Hotels. It trades about 0.04 of its potential returns per unit of risk. Lemon Tree Hotels is currently generating about 0.03 per unit of risk. If you would invest 227,326 in Kingfa Science Technology on August 25, 2024 and sell it today you would earn a total of 58,794 from holding Kingfa Science Technology or generate 25.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kingfa Science Technology vs. Lemon Tree Hotels
Performance |
| Timeline |
| Kingfa Science Technology |
| Lemon Tree Hotels |
Kingfa Science and Lemon Tree Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kingfa Science and Lemon Tree
The main advantage of trading using opposite Kingfa Science and Lemon Tree positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kingfa Science position performs unexpectedly, Lemon Tree 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 Lemon Tree will offset losses from the drop in Lemon Tree's long position.| Kingfa Science vs. Rajnandini Metal Limited | Kingfa Science vs. Hisar Metal Industries | Kingfa Science vs. Associated Alcohols Breweries | Kingfa Science vs. Hilton Metal Forging |
| Lemon Tree vs. MMTC Limited | Lemon Tree vs. Kingfa Science Technology | Lemon Tree vs. Rico Auto Industries | Lemon Tree vs. GACM Technologies Limited |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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