Correlation Between Kingfa Science and LLOYDS METALS

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

By analyzing existing cross correlation between Kingfa Science Technology and LLOYDS METALS AND, you can compare the effects of market volatilities on Kingfa Science and LLOYDS METALS 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 Kingfa Science with a short position of LLOYDS METALS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kingfa Science and LLOYDS METALS.

Diversification Opportunities for Kingfa Science and LLOYDS METALS

0.4

Correlation Coefficient

Kingfa Science  LLOYDS METALS

Very weak diversification

The 3 months correlation between Kingfa and LLOYDS is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Kingfa Science Technology and LLOYDS METALS AND in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LLOYDS METALS AND and Kingfa Science 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 Kingfa Science Technology are associated (or correlated) with LLOYDS METALS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LLOYDS METALS AND has no effect on the direction of Kingfa Science i.e., Kingfa Science and LLOYDS METALS go up and down completely randomly.

Pair Corralation between Kingfa Science and LLOYDS METALS

Assuming the 90 days trading horizon Kingfa Science Technology is expected to under-perform the LLOYDS METALS. In addition to that, Kingfa Science is 1.06 times more volatile than LLOYDS METALS AND. It trades about -0.02 of its total potential returns per unit of risk. LLOYDS METALS AND is currently generating about 0.0 per unit of volatility. If you would invest  105,025  in LLOYDS METALS AND on December 2, 2024 and sell it today you would lose (2,915) from holding LLOYDS METALS AND or give up 2.78% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Kingfa Science Technology  vs.  LLOYDS METALS AND

Kingfa Science Technology

Risk-Adjusted Performance

Very Weak

Over the last 90 days Kingfa Science Technology has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong technical and fundamental indicators, Kingfa Science is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

LLOYDS METALS AND

Risk-Adjusted Performance

Very Weak

Over the last 90 days LLOYDS METALS AND has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, LLOYDS METALS is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Kingfa Science and LLOYDS METALS

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

The idea behind Kingfa Science Technology and LLOYDS METALS AND 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.

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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.