Correlation Between China Sports and Lonkey Industrial
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By analyzing existing cross correlation between China Sports Industry and Lonkey Industrial Co, you can compare the effects of market volatilities on China Sports and Lonkey Industrial 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 China Sports with a short position of Lonkey Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Sports and Lonkey Industrial.
Diversification Opportunities for China Sports and Lonkey Industrial
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between China and Lonkey is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding China Sports Industry and Lonkey Industrial Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lonkey Industrial and China Sports 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 China Sports Industry are associated (or correlated) with Lonkey Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lonkey Industrial has no effect on the direction of China Sports i.e., China Sports and Lonkey Industrial go up and down completely randomly.
Pair Corralation between China Sports and Lonkey Industrial
Assuming the 90 days trading horizon China Sports Industry is expected to generate 0.93 times more return on investment than Lonkey Industrial. However, China Sports Industry is 1.08 times less risky than Lonkey Industrial. It trades about 0.13 of its potential returns per unit of risk. Lonkey Industrial Co is currently generating about 0.12 per unit of risk. If you would invest 704.00 in China Sports Industry on September 25, 2024 and sell it today you would earn a total of 156.00 from holding China Sports Industry or generate 22.16% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
China Sports Industry vs. Lonkey Industrial Co
Performance |
Timeline |
China Sports Industry |
Lonkey Industrial |
China Sports and Lonkey Industrial Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with China Sports and Lonkey Industrial
The main advantage of trading using opposite China Sports and Lonkey Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Sports position performs unexpectedly, Lonkey Industrial 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 Lonkey Industrial will offset losses from the drop in Lonkey Industrial's long position.China Sports vs. Qingdao Foods Co | China Sports vs. Shandong Sinoglory Health | China Sports vs. Guilin Seamild Foods | China Sports vs. Zhejiang Huatong Meat |
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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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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