Correlation Between GreenTech Environmental and Lepu Medical
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By analyzing existing cross correlation between GreenTech Environmental Co and Lepu Medical Tech, you can compare the effects of market volatilities on GreenTech Environmental 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 GreenTech Environmental with a short position of Lepu Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of GreenTech Environmental and Lepu Medical.
Diversification Opportunities for GreenTech Environmental and Lepu Medical
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between GreenTech and Lepu is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding GreenTech Environmental Co 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 GreenTech Environmental 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 GreenTech Environmental Co 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 GreenTech Environmental i.e., GreenTech Environmental and Lepu Medical go up and down completely randomly.
Pair Corralation between GreenTech Environmental and Lepu Medical
Assuming the 90 days trading horizon GreenTech Environmental Co is expected to under-perform the Lepu Medical. In addition to that, GreenTech Environmental is 1.75 times more volatile than Lepu Medical Tech. It trades about -0.22 of its total potential returns per unit of risk. Lepu Medical Tech is currently generating about 0.03 per unit of volatility. 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 | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
GreenTech Environmental Co vs. Lepu Medical Tech
Performance |
Timeline |
GreenTech Environmental |
Lepu Medical Tech |
GreenTech Environmental and Lepu Medical Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with GreenTech Environmental and Lepu Medical
The main advantage of trading using opposite GreenTech Environmental and Lepu Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GreenTech Environmental 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.GreenTech Environmental vs. BeiGene | GreenTech Environmental vs. Kweichow Moutai Co | GreenTech Environmental vs. Beijing Roborock Technology | GreenTech Environmental vs. G bits Network Technology |
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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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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