Correlation Between Loctek Ergonomic and TCL Zhonghuan
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By analyzing existing cross correlation between Loctek Ergonomic Technology and TCL Zhonghuan Renewable, you can compare the effects of market volatilities on Loctek Ergonomic and TCL Zhonghuan 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 Loctek Ergonomic with a short position of TCL Zhonghuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Loctek Ergonomic and TCL Zhonghuan.
Diversification Opportunities for Loctek Ergonomic and TCL Zhonghuan
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Loctek and TCL is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Loctek Ergonomic Technology and TCL Zhonghuan Renewable in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TCL Zhonghuan Renewable and Loctek Ergonomic 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 Loctek Ergonomic Technology are associated (or correlated) with TCL Zhonghuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TCL Zhonghuan Renewable has no effect on the direction of Loctek Ergonomic i.e., Loctek Ergonomic and TCL Zhonghuan go up and down completely randomly.
Pair Corralation between Loctek Ergonomic and TCL Zhonghuan
Assuming the 90 days trading horizon Loctek Ergonomic is expected to generate 1.54 times less return on investment than TCL Zhonghuan. But when comparing it to its historical volatility, Loctek Ergonomic Technology is 1.24 times less risky than TCL Zhonghuan. It trades about 0.03 of its potential returns per unit of risk. TCL Zhonghuan Renewable is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 856.00 in TCL Zhonghuan Renewable on September 24, 2024 and sell it today you would earn a total of 80.00 from holding TCL Zhonghuan Renewable or generate 9.35% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Loctek Ergonomic Technology vs. TCL Zhonghuan Renewable
Performance |
Timeline |
Loctek Ergonomic Tec |
TCL Zhonghuan Renewable |
Loctek Ergonomic and TCL Zhonghuan Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Loctek Ergonomic and TCL Zhonghuan
The main advantage of trading using opposite Loctek Ergonomic and TCL Zhonghuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Loctek Ergonomic position performs unexpectedly, TCL Zhonghuan 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 TCL Zhonghuan will offset losses from the drop in TCL Zhonghuan's long position.Loctek Ergonomic vs. Ming Yang Smart | Loctek Ergonomic vs. 159681 | Loctek Ergonomic vs. 159005 | Loctek Ergonomic vs. Yes Optoelectronics Co |
TCL Zhonghuan vs. Ming Yang Smart | TCL Zhonghuan vs. 159681 | TCL Zhonghuan vs. 159005 | TCL Zhonghuan vs. Loctek Ergonomic Technology |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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