Correlation Between Luckin Coffee and WT OFFSHORE
Can any of the company-specific risk be diversified away by investing in both Luckin Coffee and WT OFFSHORE 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 WT OFFSHORE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Luckin Coffee and WT OFFSHORE, you can compare the effects of market volatilities on Luckin Coffee and WT OFFSHORE 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 WT OFFSHORE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Luckin Coffee and WT OFFSHORE.
Diversification Opportunities for Luckin Coffee and WT OFFSHORE
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Luckin and UWV is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Luckin Coffee and WT OFFSHORE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WT OFFSHORE 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 WT OFFSHORE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WT OFFSHORE has no effect on the direction of Luckin Coffee i.e., Luckin Coffee and WT OFFSHORE go up and down completely randomly.
Pair Corralation between Luckin Coffee and WT OFFSHORE
Assuming the 90 days trading horizon Luckin Coffee is expected to generate 1.36 times more return on investment than WT OFFSHORE. However, Luckin Coffee is 1.36 times more volatile than WT OFFSHORE. It trades about 0.0 of its potential returns per unit of risk. WT OFFSHORE is currently generating about -0.07 per unit of risk. If you would invest 2,880 in Luckin Coffee on September 14, 2024 and sell it today you would lose (620.00) from holding Luckin Coffee or give up 21.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Luckin Coffee vs. WT OFFSHORE
Performance |
| Timeline |
| Luckin Coffee |
| WT OFFSHORE |
Luckin Coffee and WT OFFSHORE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Luckin Coffee and WT OFFSHORE
The main advantage of trading using opposite Luckin Coffee and WT OFFSHORE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Luckin Coffee position performs unexpectedly, WT OFFSHORE 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 WT OFFSHORE will offset losses from the drop in WT OFFSHORE's long position.| Luckin Coffee vs. Datang International Power | Luckin Coffee vs. Molson Coors Beverage | Luckin Coffee vs. Fevertree Drinks PLC | Luckin Coffee vs. DICKER DATA LTD |
| WT OFFSHORE vs. Apple Inc | WT OFFSHORE vs. Apple Inc | WT OFFSHORE vs. Apple Inc | WT OFFSHORE vs. Apple Inc |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Other Complementary Tools
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments |