Correlation Between Intellian Technologies and Lion Chemtech

Can any of the company-specific risk be diversified away by investing in both Intellian Technologies and Lion Chemtech 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 Intellian Technologies and Lion Chemtech into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Intellian Technologies and Lion Chemtech Co, you can compare the effects of market volatilities on Intellian Technologies and Lion Chemtech 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 Intellian Technologies with a short position of Lion Chemtech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intellian Technologies and Lion Chemtech.

Diversification Opportunities for Intellian Technologies and Lion Chemtech

-0.44

Correlation Coefficient

Intellian Technologies  Lion Chemtech

Very good diversification

The 3 months correlation between Intellian and Lion is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Intellian Technologies and Lion Chemtech Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lion Chemtech and Intellian Technologies 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 Intellian Technologies are associated (or correlated) with Lion Chemtech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lion Chemtech has no effect on the direction of Intellian Technologies i.e., Intellian Technologies and Lion Chemtech go up and down completely randomly.

Pair Corralation between Intellian Technologies and Lion Chemtech

Assuming the 90 days trading horizon Intellian Technologies is expected to under-perform the Lion Chemtech. In addition to that, Intellian Technologies is 1.31 times more volatile than Lion Chemtech Co. It trades about -0.13 of its total potential returns per unit of risk. Lion Chemtech Co is currently generating about 0.12 per unit of volatility. If you would invest  208,000  in Lion Chemtech Co on September 5, 2024 and sell it today you would earn a total of  42,000  from holding Lion Chemtech Co or generate 20.19% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Intellian Technologies  vs.  Lion Chemtech Co

Intellian Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Intellian Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Lion Chemtech

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Lion Chemtech Co are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Lion Chemtech sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Intellian Technologies and Lion Chemtech

The main advantage of trading using opposite Intellian Technologies and Lion Chemtech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intellian Technologies position performs unexpectedly, Lion Chemtech 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 Lion Chemtech will offset losses from the drop in Lion Chemtech's long position.

The idea behind Intellian Technologies and Lion Chemtech Co pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.