Correlation Between Lalin Property and Country Group

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

By analyzing existing cross correlation between Lalin Property Public and Country Group Holdings, you can compare the effects of market volatilities on Lalin Property and Country Group 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 Lalin Property with a short position of Country Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lalin Property and Country Group.

Diversification Opportunities for Lalin Property and Country Group

0.89

Correlation Coefficient

Lalin Property  Country Group

Very poor diversification

The 3 months correlation between Lalin and Country is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Lalin Property Public and Country Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Country Group Holdings and Lalin Property 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 Lalin Property Public are associated (or correlated) with Country Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Country Group Holdings has no effect on the direction of Lalin Property i.e., Lalin Property and Country Group go up and down completely randomly.

Pair Corralation between Lalin Property and Country Group

Assuming the 90 days trading horizon Lalin Property Public is expected to under-perform the Country Group. But the stock apears to be less risky and, when comparing its historical volatility, Lalin Property Public is 3.63 times less risky than Country Group. The stock trades about -0.33 of its potential returns per unit of risk. The Country Group Holdings is currently generating about -0.09 of returns per unit of risk over similar time horizon. If you would invest  56.00  in Country Group Holdings on December 4, 2024 and sell it today you would lose (4.00) from holding Country Group Holdings or give up 7.14% of portfolio value over 90 days.

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

Lalin Property Public  vs.  Country Group Holdings

Lalin Property Public

Risk-Adjusted Performance

Very Weak

Over the last 90 days Lalin Property Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's fundamental drivers remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Country Group Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days Country Group Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's technical indicators remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Lalin Property and Country Group

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

The idea behind Lalin Property Public and Country Group Holdings 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .