Correlation Between Lufax Holding and Qudian
Can any of the company-specific risk be diversified away by investing in both Lufax Holding and Qudian 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 Qudian into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lufax Holding and Qudian Inc, you can compare the effects of market volatilities on Lufax Holding and Qudian 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 Qudian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lufax Holding and Qudian.
Diversification Opportunities for Lufax Holding and Qudian
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Lufax and Qudian is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Lufax Holding and Qudian Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qudian Inc 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 Qudian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qudian Inc has no effect on the direction of Lufax Holding i.e., Lufax Holding and Qudian go up and down completely randomly.
Pair Corralation between Lufax Holding and Qudian
Allowing for the 90-day total investment horizon Lufax Holding is expected to under-perform the Qudian. In addition to that, Lufax Holding is 1.19 times more volatile than Qudian Inc. It trades about -0.23 of its total potential returns per unit of risk. Qudian Inc is currently generating about -0.11 per unit of volatility. If you would invest 245.00 in Qudian Inc on August 27, 2024 and sell it today you would lose (16.00) from holding Qudian Inc or give up 6.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lufax Holding vs. Qudian Inc
Performance |
| Timeline |
| Lufax Holding |
| Qudian Inc |
Lufax Holding and Qudian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lufax Holding and Qudian
The main advantage of trading using opposite Lufax Holding and Qudian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lufax Holding position performs unexpectedly, Qudian 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 Qudian will offset losses from the drop in Qudian's long position.| Lufax Holding vs. SLM Corp | Lufax Holding vs. Orix Corp Ads | Lufax Holding vs. FirstCash | Lufax Holding vs. Medallion Financial Corp |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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