Correlation Between Lakeside Holding and Expeditors International

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

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

Diversification Opportunities for Lakeside Holding and Expeditors International

0.17

Correlation Coefficient

Lakeside Holding  Expeditors International

Average diversification

The 3 months correlation between Lakeside and Expeditors is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Lakeside Holding Limited and Expeditors International of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Expeditors International and Lakeside Holding 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 Lakeside Holding Limited are associated (or correlated) with Expeditors International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Expeditors International has no effect on the direction of Lakeside Holding i.e., Lakeside Holding and Expeditors International go up and down completely randomly.

Pair Corralation between Lakeside Holding and Expeditors International

Considering the 90-day investment horizon Lakeside Holding Limited is expected to generate 12.27 times more return on investment than Expeditors International. However, Lakeside Holding is 12.27 times more volatile than Expeditors International of. It trades about 0.09 of its potential returns per unit of risk. Expeditors International of is currently generating about 0.11 per unit of risk. If you would invest  223.00  in Lakeside Holding Limited on September 2, 2024 and sell it today you would earn a total of  22.00  from holding Lakeside Holding Limited or generate 9.87% return on investment over 90 days.

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

Lakeside Holding Limited  vs.  Expeditors International of

Lakeside Holding

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Lakeside Holding Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Lakeside Holding is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Expeditors International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Expeditors International of has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Expeditors International is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Lakeside Holding and Expeditors International

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

The idea behind Lakeside Holding Limited and Expeditors International of 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.