Correlation Between Locafy and Lizhi
Can any of the company-specific risk be diversified away by investing in both Locafy 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 Locafy and Lizhi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Locafy and Lizhi Inc, you can compare the effects of market volatilities on Locafy 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 Locafy with a short position of Lizhi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Locafy and Lizhi.
Diversification Opportunities for Locafy and Lizhi
Pay attention - limited upside
The 3 months correlation between Locafy and Lizhi is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Locafy and Lizhi Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lizhi Inc and Locafy 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 Locafy 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 Locafy i.e., Locafy and Lizhi go up and down completely randomly.
Pair Corralation between Locafy and Lizhi
If you would invest (100.00) in Lizhi Inc on November 18, 2024 and sell it today you would earn a total of 100.00 from holding Lizhi Inc or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Locafy vs. Lizhi Inc
Performance |
| Timeline |
| Locafy |
| Lizhi Inc |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
Locafy and Lizhi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Locafy and Lizhi
The main advantage of trading using opposite Locafy and Lizhi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Locafy 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.| Locafy vs. Metalpha Technology Holding | Locafy vs. 36Kr Holdings | Locafy vs. TuanChe ADR | Locafy vs. Quizam Media |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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