Correlation Between Lufax Holding and Arthur J
Can any of the company-specific risk be diversified away by investing in both Lufax Holding and Arthur J 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 Lufax Holding and Arthur J into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lufax Holding and Arthur J Gallagher, you can compare the effects of market volatilities on Lufax Holding and Arthur J 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 Lufax Holding with a short position of Arthur J. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lufax Holding and Arthur J.
Diversification Opportunities for Lufax Holding and Arthur J
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lufax and Arthur is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Lufax Holding and Arthur J Gallagher in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arthur J Gallagher and Lufax Holding 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 Lufax Holding are associated (or correlated) with Arthur J. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arthur J Gallagher has no effect on the direction of Lufax Holding i.e., Lufax Holding and Arthur J go up and down completely randomly.
Pair Corralation between Lufax Holding and Arthur J
Allowing for the 90-day total investment horizon Lufax Holding is expected to under-perform the Arthur J. In addition to that, Lufax Holding is 3.12 times more volatile than Arthur J Gallagher. It trades about -0.23 of its total potential returns per unit of risk. Arthur J Gallagher is currently generating about 0.32 per unit of volatility. If you would invest 28,599 in Arthur J Gallagher on August 28, 2024 and sell it today you would earn a total of 2,040 from holding Arthur J Gallagher or generate 7.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lufax Holding vs. Arthur J Gallagher
Performance |
| Timeline |
| Lufax Holding |
| Arthur J Gallagher |
Lufax Holding and Arthur J Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lufax Holding and Arthur J
The main advantage of trading using opposite Lufax Holding and Arthur J positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lufax Holding position performs unexpectedly, Arthur J 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 Arthur J will offset losses from the drop in Arthur J's long position.| Lufax Holding vs. 360 Finance | Lufax Holding vs. FinVolution Group | Lufax Holding vs. Qudian Inc | Lufax Holding vs. X Financial Class |
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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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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