Correlation Between BingEx and Landstar System

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

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

Diversification Opportunities for BingEx and Landstar System

-0.18

Correlation Coefficient

BingEx  Landstar System

Good diversification

The 3 months correlation between BingEx and Landstar is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding BingEx and Landstar System in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Landstar System and BingEx 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 BingEx are associated (or correlated) with Landstar System. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Landstar System has no effect on the direction of BingEx i.e., BingEx and Landstar System go up and down completely randomly.

Pair Corralation between BingEx and Landstar System

Considering the 90-day investment horizon BingEx is expected to under-perform the Landstar System. In addition to that, BingEx is 4.07 times more volatile than Landstar System. It trades about -0.11 of its total potential returns per unit of risk. Landstar System is currently generating about 0.01 per unit of volatility. If you would invest  18,124  in Landstar System on September 10, 2024 and sell it today you would earn a total of  5.00  from holding Landstar System or generate 0.03% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	73.44%
Values	Daily Returns

BingEx  vs.  Landstar System

BingEx

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days BingEx has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's essential indicators remain fairly 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.

Landstar System

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Landstar System has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Landstar System is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with BingEx and Landstar System

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

The idea behind BingEx and Landstar System 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.