Correlation Between Nucletron Electronic and Luckin Coffee

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

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

Diversification Opportunities for Nucletron Electronic and Luckin Coffee

0.0

Correlation Coefficient

Nucletron Electronic  Luckin Coffee

Pay attention - limited upside

The 3 months correlation between Nucletron and Luckin is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Nucletron Electronic Aktienges and Luckin Coffee in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Luckin Coffee and Nucletron Electronic 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 Nucletron Electronic Aktiengesellschaft are associated (or correlated) with Luckin Coffee. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Luckin Coffee has no effect on the direction of Nucletron Electronic i.e., Nucletron Electronic and Luckin Coffee go up and down completely randomly.

Pair Corralation between Nucletron Electronic and Luckin Coffee

Assuming the 90 days horizon Nucletron Electronic is expected to generate 4.73 times less return on investment than Luckin Coffee. But when comparing it to its historical volatility, Nucletron Electronic Aktiengesellschaft is 13.42 times less risky than Luckin Coffee. It trades about 0.06 of its potential returns per unit of risk. Luckin Coffee is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  2,240  in Luckin Coffee on October 2, 2024 and sell it today you would earn a total of  40.00  from holding Luckin Coffee or generate 1.79% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	99.6%
Values	Daily Returns

Nucletron Electronic Aktienges  vs.  Luckin Coffee

Nucletron Electronic

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Nucletron Electronic Aktiengesellschaft has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Nucletron Electronic is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Luckin Coffee

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Luckin Coffee has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Luckin Coffee is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Nucletron Electronic and Luckin Coffee

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

The idea behind Nucletron Electronic Aktiengesellschaft and Luckin Coffee 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.