Correlation Between Lotte Chemical and Towellers
Specify exactly 2 symbols:
By analyzing existing cross correlation between Lotte Chemical Pakistan and Towellers, you can compare the effects of market volatilities on Lotte Chemical and Towellers 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 Towellers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lotte Chemical and Towellers.
Diversification Opportunities for Lotte Chemical and Towellers
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Lotte and Towellers is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Lotte Chemical Pakistan and Towellers in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Towellers 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 Towellers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Towellers has no effect on the direction of Lotte Chemical i.e., Lotte Chemical and Towellers go up and down completely randomly.
Pair Corralation between Lotte Chemical and Towellers
Assuming the 90 days trading horizon Lotte Chemical Pakistan is expected to generate 1.91 times more return on investment than Towellers. However, Lotte Chemical is 1.91 times more volatile than Towellers. It trades about 0.31 of its potential returns per unit of risk. Towellers is currently generating about 0.09 per unit of risk. If you would invest 1,731 in Lotte Chemical Pakistan on September 13, 2024 and sell it today you would earn a total of 521.00 from holding Lotte Chemical Pakistan or generate 30.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Lotte Chemical Pakistan vs. Towellers
Performance |
| Timeline |
| Lotte Chemical Pakistan |
| Towellers |
Lotte Chemical and Towellers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lotte Chemical and Towellers
The main advantage of trading using opposite Lotte Chemical and Towellers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lotte Chemical position performs unexpectedly, Towellers 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 Towellers will offset losses from the drop in Towellers' long position.| Lotte Chemical vs. Orient Rental Modaraba | Lotte Chemical vs. Metropolitan Steel Corp | Lotte Chemical vs. Pakistan Synthetics | Lotte Chemical vs. Grays Leasing |
| Towellers vs. Unity Foods | Towellers vs. Unilever Pakistan Foods | Towellers vs. Hi Tech Lubricants | Towellers vs. Pakistan Telecommunication |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
Other Complementary Tools
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities |