Correlation Between Lenovo Group and JIAHUA STORES
Can any of the company-specific risk be diversified away by investing in both Lenovo Group and JIAHUA STORES 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 Lenovo Group and JIAHUA STORES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lenovo Group Limited and JIAHUA STORES, you can compare the effects of market volatilities on Lenovo Group and JIAHUA STORES 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 Lenovo Group with a short position of JIAHUA STORES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lenovo Group and JIAHUA STORES.
Diversification Opportunities for Lenovo Group and JIAHUA STORES
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Lenovo and JIAHUA is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Lenovo Group Limited and JIAHUA STORES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JIAHUA STORES and Lenovo Group 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 Lenovo Group Limited are associated (or correlated) with JIAHUA STORES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JIAHUA STORES has no effect on the direction of Lenovo Group i.e., Lenovo Group and JIAHUA STORES go up and down completely randomly.
Pair Corralation between Lenovo Group and JIAHUA STORES
If you would invest 2,218 in Lenovo Group Limited on September 13, 2024 and sell it today you would earn a total of 62.00 from holding Lenovo Group Limited or generate 2.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lenovo Group Limited vs. JIAHUA STORES
Performance |
| Timeline |
| Lenovo Group Limited |
| JIAHUA STORES |
Lenovo Group and JIAHUA STORES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lenovo Group and JIAHUA STORES
The main advantage of trading using opposite Lenovo Group and JIAHUA STORES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lenovo Group position performs unexpectedly, JIAHUA STORES 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 JIAHUA STORES will offset losses from the drop in JIAHUA STORES's long position.| Lenovo Group vs. JIAHUA STORES | Lenovo Group vs. COSTCO WHOLESALE CDR | Lenovo Group vs. Retail Estates NV | Lenovo Group vs. SCANSOURCE |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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