Correlation Between Lufax Holding and Bannix Acquisition
Can any of the company-specific risk be diversified away by investing in both Lufax Holding and Bannix Acquisition 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 Bannix Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lufax Holding and Bannix Acquisition Corp, you can compare the effects of market volatilities on Lufax Holding and Bannix Acquisition 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 Bannix Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lufax Holding and Bannix Acquisition.
Diversification Opportunities for Lufax Holding and Bannix Acquisition
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Lufax and Bannix is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Lufax Holding and Bannix Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bannix Acquisition Corp 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 Bannix Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bannix Acquisition Corp has no effect on the direction of Lufax Holding i.e., Lufax Holding and Bannix Acquisition go up and down completely randomly.
Pair Corralation between Lufax Holding and Bannix Acquisition
Allowing for the 90-day total investment horizon Lufax Holding is expected to generate 0.3 times more return on investment than Bannix Acquisition. However, Lufax Holding is 3.3 times less risky than Bannix Acquisition. It trades about -0.25 of its potential returns per unit of risk. Bannix Acquisition Corp is currently generating about -0.3 per unit of risk. If you would invest 298.00 in Lufax Holding on January 9, 2025 and sell it today you would lose (53.00) from holding Lufax Holding or give up 17.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 22.73% |
| Values | Daily Returns |
Lufax Holding vs. Bannix Acquisition Corp
Performance |
| Timeline |
| Lufax Holding |
| Bannix Acquisition Corp |
Risk-Adjusted Performance
Good
Weak | Strong |
Lufax Holding and Bannix Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lufax Holding and Bannix Acquisition
The main advantage of trading using opposite Lufax Holding and Bannix Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lufax Holding position performs unexpectedly, Bannix Acquisition 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 Bannix Acquisition will offset losses from the drop in Bannix Acquisition's long position.| Lufax Holding vs. 360 Finance | Lufax Holding vs. FinVolution Group | Lufax Holding vs. Qudian Inc | Lufax Holding vs. X Financial Class |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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