Correlation Between Lotte Chemical and Bilal Fibres
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By analyzing existing cross correlation between Lotte Chemical Pakistan and Bilal Fibres, you can compare the effects of market volatilities on Lotte Chemical and Bilal Fibres 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 Lotte Chemical with a short position of Bilal Fibres. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lotte Chemical and Bilal Fibres.
Diversification Opportunities for Lotte Chemical and Bilal Fibres
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Lotte and Bilal is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Lotte Chemical Pakistan and Bilal Fibres in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bilal Fibres and Lotte Chemical 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 Lotte Chemical Pakistan are associated (or correlated) with Bilal Fibres. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bilal Fibres has no effect on the direction of Lotte Chemical i.e., Lotte Chemical and Bilal Fibres go up and down completely randomly.
Pair Corralation between Lotte Chemical and Bilal Fibres
Assuming the 90 days trading horizon Lotte Chemical is expected to generate 25.33 times less return on investment than Bilal Fibres. But when comparing it to its historical volatility, Lotte Chemical Pakistan is 4.15 times less risky than Bilal Fibres. It trades about 0.03 of its potential returns per unit of risk. Bilal Fibres is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 314.00 in Bilal Fibres on August 30, 2024 and sell it today you would earn a total of 1,306 from holding Bilal Fibres or generate 415.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lotte Chemical Pakistan vs. Bilal Fibres
Performance |
| Timeline |
| Lotte Chemical Pakistan |
| Bilal Fibres |
Lotte Chemical and Bilal Fibres Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lotte Chemical and Bilal Fibres
The main advantage of trading using opposite Lotte Chemical and Bilal Fibres positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lotte Chemical position performs unexpectedly, Bilal Fibres 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 Bilal Fibres will offset losses from the drop in Bilal Fibres' long position.| Lotte Chemical vs. Masood Textile Mills | Lotte Chemical vs. Fauji Foods | Lotte Chemical vs. KSB Pumps | Lotte Chemical vs. Mari Petroleum |
| Bilal Fibres vs. Big Bird Foods | Bilal Fibres vs. Matco Foods | Bilal Fibres vs. Adamjee Insurance | Bilal Fibres vs. AKD Hospitality |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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