Correlation Between Sixt Leasing and Luckin Coffee
Can any of the company-specific risk be diversified away by investing in both Sixt Leasing and Luckin Coffee 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 Sixt Leasing and Luckin Coffee into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sixt Leasing SE and Luckin Coffee, you can compare the effects of market volatilities on Sixt Leasing and Luckin Coffee 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 Sixt Leasing with a short position of Luckin Coffee. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sixt Leasing and Luckin Coffee.
Diversification Opportunities for Sixt Leasing and Luckin Coffee
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sixt and Luckin is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Sixt Leasing SE and Luckin Coffee in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Luckin Coffee and Sixt Leasing 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 Sixt Leasing SE are associated (or correlated) with Luckin Coffee. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Luckin Coffee has no effect on the direction of Sixt Leasing i.e., Sixt Leasing and Luckin Coffee go up and down completely randomly.
Pair Corralation between Sixt Leasing and Luckin Coffee
Assuming the 90 days trading horizon Sixt Leasing SE is expected to generate 0.54 times more return on investment than Luckin Coffee. However, Sixt Leasing SE is 1.86 times less risky than Luckin Coffee. It trades about -0.13 of its potential returns per unit of risk. Luckin Coffee is currently generating about -0.21 per unit of risk. If you would invest 990.00 in Sixt Leasing SE on September 1, 2024 and sell it today you would lose (65.00) from holding Sixt Leasing SE or give up 6.57% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sixt Leasing SE vs. Luckin Coffee
Performance |
| Timeline |
| Sixt Leasing SE |
| Luckin Coffee |
Sixt Leasing and Luckin Coffee Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sixt Leasing and Luckin Coffee
The main advantage of trading using opposite Sixt Leasing and Luckin Coffee positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sixt Leasing position performs unexpectedly, Luckin Coffee 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 Luckin Coffee will offset losses from the drop in Luckin Coffee's long position.| Sixt Leasing vs. Apple Inc | Sixt Leasing vs. Apple Inc | Sixt Leasing vs. Apple Inc | Sixt Leasing vs. Apple Inc |
| Luckin Coffee vs. United Natural Foods | Luckin Coffee vs. TreeHouse Foods | Luckin Coffee vs. WILLIS LEASE FIN | Luckin Coffee vs. Sixt Leasing SE |
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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