Correlation Between MINCO SILVER and Luckin Coffee
Can any of the company-specific risk be diversified away by investing in both MINCO SILVER and Luckin Coffee 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 MINCO SILVER and Luckin Coffee into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MINCO SILVER and Luckin Coffee, you can compare the effects of market volatilities on MINCO SILVER and Luckin Coffee 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 MINCO SILVER with a short position of Luckin Coffee. Check out your portfolio center. Please also check ongoing floating volatility patterns of MINCO SILVER and Luckin Coffee.
Diversification Opportunities for MINCO SILVER and Luckin Coffee
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between MINCO and Luckin is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding MINCO SILVER and Luckin Coffee in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Luckin Coffee and MINCO SILVER 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 MINCO SILVER are associated (or correlated) with Luckin Coffee. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Luckin Coffee has no effect on the direction of MINCO SILVER i.e., MINCO SILVER and Luckin Coffee go up and down completely randomly.
Pair Corralation between MINCO SILVER and Luckin Coffee
Assuming the 90 days trading horizon MINCO SILVER is expected to generate 0.91 times more return on investment than Luckin Coffee. However, MINCO SILVER is 1.09 times less risky than Luckin Coffee. It trades about 0.1 of its potential returns per unit of risk. Luckin Coffee is currently generating about -0.04 per unit of risk. If you would invest 12.00 in MINCO SILVER on August 24, 2024 and sell it today you would earn a total of 1.00 from holding MINCO SILVER or generate 8.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
MINCO SILVER vs. Luckin Coffee
Performance |
| Timeline |
| MINCO SILVER |
| Luckin Coffee |
MINCO SILVER and Luckin Coffee Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MINCO SILVER and Luckin Coffee
The main advantage of trading using opposite MINCO SILVER and Luckin Coffee positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MINCO SILVER position performs unexpectedly, Luckin Coffee 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 Luckin Coffee will offset losses from the drop in Luckin Coffee's long position.| MINCO SILVER vs. Apple Inc | MINCO SILVER vs. Apple Inc | MINCO SILVER vs. Apple Inc | MINCO SILVER vs. Apple Inc |
| Luckin Coffee vs. Apple Inc | Luckin Coffee vs. Apple Inc | Luckin Coffee vs. Apple Inc | Luckin Coffee vs. Apple Inc |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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