Correlation Between Railway Signal and Lepu Medical
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By analyzing existing cross correlation between Railway Signal Communication and Lepu Medical Tech, you can compare the effects of market volatilities on Railway Signal and Lepu Medical 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 Railway Signal with a short position of Lepu Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Railway Signal and Lepu Medical.
Diversification Opportunities for Railway Signal and Lepu Medical
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Railway and Lepu is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Railway Signal Communication and Lepu Medical Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lepu Medical Tech and Railway Signal 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 Railway Signal Communication are associated (or correlated) with Lepu Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lepu Medical Tech has no effect on the direction of Railway Signal i.e., Railway Signal and Lepu Medical go up and down completely randomly.
Pair Corralation between Railway Signal and Lepu Medical
Assuming the 90 days trading horizon Railway Signal Communication is expected to under-perform the Lepu Medical. But the stock apears to be less risky and, when comparing its historical volatility, Railway Signal Communication is 1.51 times less risky than Lepu Medical. The stock trades about -0.08 of its potential returns per unit of risk. The Lepu Medical Tech is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,176 in Lepu Medical Tech on September 25, 2024 and sell it today you would earn a total of 9.00 from holding Lepu Medical Tech or generate 0.77% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Railway Signal Communication vs. Lepu Medical Tech
Performance |
Timeline |
Railway Signal Commu |
Lepu Medical Tech |
Railway Signal and Lepu Medical Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Railway Signal and Lepu Medical
The main advantage of trading using opposite Railway Signal and Lepu Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Railway Signal position performs unexpectedly, Lepu Medical 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 Lepu Medical will offset losses from the drop in Lepu Medical's long position.Railway Signal vs. Kweichow Moutai Co | Railway Signal vs. Shenzhen Mindray Bio Medical | Railway Signal vs. Jiangsu Pacific Quartz | Railway Signal vs. G bits Network Technology |
Lepu Medical vs. TongFu Microelectronics Co | Lepu Medical vs. Ping An Insurance | Lepu Medical vs. GreenTech Environmental Co | Lepu Medical vs. Central Plains Environment |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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