Correlation Between Lufax Holding and Nisun International

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

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

Diversification Opportunities for Lufax Holding and Nisun International

0.18

Correlation Coefficient

Lufax Holding  Nisun International

Average diversification

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

Pair Corralation between Lufax Holding and Nisun International

Allowing for the 90-day total investment horizon Lufax Holding is expected to generate 0.64 times more return on investment than Nisun International. However, Lufax Holding is 1.56 times less risky than Nisun International. It trades about 0.11 of its potential returns per unit of risk. Nisun International Enterprise is currently generating about 0.0 per unit of risk. If you would invest  245.00  in Lufax Holding on November 28, 2024 and sell it today you would earn a total of  57.00  from holding Lufax Holding or generate 23.27% return on investment over 90 days.

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

Lufax Holding  vs.  Nisun International Enterprise

Lufax Holding

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Lufax Holding are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating basic indicators, Lufax Holding unveiled solid returns over the last few months and may actually be approaching a breakup point.

Nisun International

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Lufax Holding and Nisun International

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

The idea behind Lufax Holding and Nisun International Enterprise 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.