Correlation Between Lufax Holding and Distoken Acquisition
Can any of the company-specific risk be diversified away by investing in both Lufax Holding and Distoken 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 Distoken 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 Distoken Acquisition, you can compare the effects of market volatilities on Lufax Holding and Distoken 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 Distoken Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lufax Holding and Distoken Acquisition.
Diversification Opportunities for Lufax Holding and Distoken Acquisition
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lufax and Distoken is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Lufax Holding and Distoken Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Distoken Acquisition 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 Distoken Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Distoken Acquisition has no effect on the direction of Lufax Holding i.e., Lufax Holding and Distoken Acquisition go up and down completely randomly.
Pair Corralation between Lufax Holding and Distoken Acquisition
Allowing for the 90-day total investment horizon Lufax Holding is expected to under-perform the Distoken Acquisition. But the stock apears to be less risky and, when comparing its historical volatility, Lufax Holding is 15.04 times less risky than Distoken Acquisition. The stock trades about -0.05 of its potential returns per unit of risk. The Distoken Acquisition is currently generating about 0.29 of returns per unit of risk over similar time horizon. If you would invest 1.40 in Distoken Acquisition on August 30, 2024 and sell it today you would earn a total of 1.01 from holding Distoken Acquisition or generate 72.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 30.43% |
| Values | Daily Returns |
Lufax Holding vs. Distoken Acquisition
Performance |
| Timeline |
| Lufax Holding |
| Distoken Acquisition |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Modest
Lufax Holding and Distoken Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lufax Holding and Distoken Acquisition
The main advantage of trading using opposite Lufax Holding and Distoken Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lufax Holding position performs unexpectedly, Distoken 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 Distoken Acquisition will offset losses from the drop in Distoken Acquisition's long position.| Lufax Holding vs. 360 Finance | Lufax Holding vs. Atlanticus Holdings | Lufax Holding vs. X Financial Class | Lufax Holding vs. Yirendai |
| Distoken Acquisition vs. ClimateRock Class A | Distoken Acquisition vs. CF Acquisition VII | Distoken Acquisition vs. DP Cap Acquisition |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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