Correlation Between Lotus Technology and F PD
Can any of the company-specific risk be diversified away by investing in both Lotus Technology and F PD 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 Lotus Technology and F PD into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lotus Technology Warrants and F PD, you can compare the effects of market volatilities on Lotus Technology and F PD 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 Lotus Technology with a short position of F PD. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lotus Technology and F PD.
Diversification Opportunities for Lotus Technology and F PD
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lotus and F-PD is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Lotus Technology Warrants and F PD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on F PD and Lotus Technology 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 Lotus Technology Warrants are associated (or correlated) with F PD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of F PD has no effect on the direction of Lotus Technology i.e., Lotus Technology and F PD go up and down completely randomly.
Pair Corralation between Lotus Technology and F PD
Assuming the 90 days horizon Lotus Technology Warrants is expected to generate 21.22 times more return on investment than F PD. However, Lotus Technology is 21.22 times more volatile than F PD. It trades about 0.01 of its potential returns per unit of risk. F PD is currently generating about 0.02 per unit of risk. If you would invest 27.00 in Lotus Technology Warrants on August 25, 2024 and sell it today you would lose (1.00) from holding Lotus Technology Warrants or give up 3.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 63.64% |
| Values | Daily Returns |
Lotus Technology Warrants vs. F PD
Performance |
| Timeline |
| Lotus Technology Warrants |
| F PD |
Lotus Technology and F PD Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lotus Technology and F PD
The main advantage of trading using opposite Lotus Technology and F PD positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lotus Technology position performs unexpectedly, F PD 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 F PD will offset losses from the drop in F PD's long position.| Lotus Technology vs. F PD | Lotus Technology vs. China Yuchai International | Lotus Technology vs. SRIVARU Holding Limited | Lotus Technology vs. Canoo Holdings |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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