Correlation Between Pingtan Marine and Lanxess AG
Can any of the company-specific risk be diversified away by investing in both Pingtan Marine and Lanxess AG 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 Pingtan Marine and Lanxess AG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pingtan Marine Enterprise and Lanxess AG, you can compare the effects of market volatilities on Pingtan Marine and Lanxess AG 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 Pingtan Marine with a short position of Lanxess AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pingtan Marine and Lanxess AG.
Diversification Opportunities for Pingtan Marine and Lanxess AG
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Pingtan and Lanxess is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Pingtan Marine Enterprise and Lanxess AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lanxess AG and Pingtan Marine 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 Pingtan Marine Enterprise are associated (or correlated) with Lanxess AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lanxess AG has no effect on the direction of Pingtan Marine i.e., Pingtan Marine and Lanxess AG go up and down completely randomly.
Pair Corralation between Pingtan Marine and Lanxess AG
If you would invest 27.00 in Pingtan Marine Enterprise on August 31, 2024 and sell it today you would earn a total of 0.00 from holding Pingtan Marine Enterprise or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.55% |
| Values | Daily Returns |
Pingtan Marine Enterprise vs. Lanxess AG
Performance |
| Timeline |
| Pingtan Marine Enterprise |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Lanxess AG |
Pingtan Marine and Lanxess AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pingtan Marine and Lanxess AG
The main advantage of trading using opposite Pingtan Marine and Lanxess AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pingtan Marine position performs unexpectedly, Lanxess AG 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 Lanxess AG will offset losses from the drop in Lanxess AG's long position.| Pingtan Marine vs. Eastman Chemical | Pingtan Marine vs. Chemours Co | Pingtan Marine vs. Sensient Technologies | Pingtan Marine vs. Hooker Furniture |
| Lanxess AG vs. Air Products and | Lanxess AG vs. Linde plc Ordinary | Lanxess AG vs. Sherwin Williams Co | Lanxess AG vs. PPG Industries |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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