Correlation Between Luckin Coffee and JAPFA COMFEED
Can any of the company-specific risk be diversified away by investing in both Luckin Coffee and JAPFA COMFEED 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 Luckin Coffee and JAPFA COMFEED into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Luckin Coffee and JAPFA FEED A , you can compare the effects of market volatilities on Luckin Coffee and JAPFA COMFEED 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 Luckin Coffee with a short position of JAPFA COMFEED. Check out your portfolio center. Please also check ongoing floating volatility patterns of Luckin Coffee and JAPFA COMFEED.
Diversification Opportunities for Luckin Coffee and JAPFA COMFEED
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Luckin and JAPFA is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Luckin Coffee and JAPFA FEED A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JAPFA COMFEED and Luckin Coffee 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 Luckin Coffee are associated (or correlated) with JAPFA COMFEED. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JAPFA COMFEED has no effect on the direction of Luckin Coffee i.e., Luckin Coffee and JAPFA COMFEED go up and down completely randomly.
Pair Corralation between Luckin Coffee and JAPFA COMFEED
Assuming the 90 days trading horizon Luckin Coffee is expected to generate 34.59 times less return on investment than JAPFA COMFEED. In addition to that, Luckin Coffee is 1.92 times more volatile than JAPFA FEED A . It trades about 0.0 of its total potential returns per unit of risk. JAPFA FEED A is currently generating about 0.08 per unit of volatility. If you would invest 6.65 in JAPFA FEED A on September 4, 2024 and sell it today you would earn a total of 3.35 from holding JAPFA FEED A or generate 50.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Luckin Coffee vs. JAPFA FEED A
Performance |
| Timeline |
| Luckin Coffee |
| JAPFA COMFEED |
Luckin Coffee and JAPFA COMFEED Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Luckin Coffee and JAPFA COMFEED
The main advantage of trading using opposite Luckin Coffee and JAPFA COMFEED positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Luckin Coffee position performs unexpectedly, JAPFA COMFEED 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 JAPFA COMFEED will offset losses from the drop in JAPFA COMFEED's long position.| Luckin Coffee vs. Apple Inc | Luckin Coffee vs. Apple Inc | Luckin Coffee vs. Apple Inc | Luckin Coffee vs. Apple Inc |
| JAPFA COMFEED vs. DeVry Education Group | JAPFA COMFEED vs. EAT WELL INVESTMENT | JAPFA COMFEED vs. SWISS WATER DECAFFCOFFEE | JAPFA COMFEED vs. Luckin Coffee |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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