Correlation Between Li Ning and WAGNERS HOLDING
Can any of the company-specific risk be diversified away by investing in both Li Ning and WAGNERS HOLDING 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 Li Ning and WAGNERS HOLDING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Li Ning Company and WAGNERS HOLDING LTD, you can compare the effects of market volatilities on Li Ning and WAGNERS HOLDING 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 Li Ning with a short position of WAGNERS HOLDING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Li Ning and WAGNERS HOLDING.
Diversification Opportunities for Li Ning and WAGNERS HOLDING
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between LNLB and WAGNERS is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Li Ning Company and WAGNERS HOLDING LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WAGNERS HOLDING LTD and Li Ning 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 Li Ning Company are associated (or correlated) with WAGNERS HOLDING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WAGNERS HOLDING LTD has no effect on the direction of Li Ning i.e., Li Ning and WAGNERS HOLDING go up and down completely randomly.
Pair Corralation between Li Ning and WAGNERS HOLDING
Assuming the 90 days trading horizon Li Ning Company is expected to generate 0.86 times more return on investment than WAGNERS HOLDING. However, Li Ning Company is 1.16 times less risky than WAGNERS HOLDING. It trades about 0.13 of its potential returns per unit of risk. WAGNERS HOLDING LTD is currently generating about 0.0 per unit of risk. If you would invest 188.00 in Li Ning Company on September 27, 2024 and sell it today you would earn a total of 14.00 from holding Li Ning Company or generate 7.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Li Ning Company vs. WAGNERS HOLDING LTD
Performance |
| Timeline |
| Li Ning Company |
| WAGNERS HOLDING LTD |
Li Ning and WAGNERS HOLDING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Li Ning and WAGNERS HOLDING
The main advantage of trading using opposite Li Ning and WAGNERS HOLDING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Li Ning position performs unexpectedly, WAGNERS HOLDING 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 WAGNERS HOLDING will offset losses from the drop in WAGNERS HOLDING's long position.| Li Ning vs. Booking Holdings | Li Ning vs. ANTA Sports Products | Li Ning vs. Expedia Group | Li Ning vs. Shimano |
| WAGNERS HOLDING vs. Tencent Music Entertainment | WAGNERS HOLDING vs. GAMING FAC SA | WAGNERS HOLDING vs. Seven West Media | WAGNERS HOLDING vs. Live Nation Entertainment |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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