Correlation Between Orient Technologies and LLOYDS METALS

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

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

Diversification Opportunities for Orient Technologies and LLOYDS METALS

0.84

Correlation Coefficient

Orient Technologies  LLOYDS METALS

Very poor diversification

The 3 months correlation between Orient and LLOYDS is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Orient Technologies Limited 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 Orient Technologies 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 Orient Technologies Limited 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 Orient Technologies i.e., Orient Technologies and LLOYDS METALS go up and down completely randomly.

Pair Corralation between Orient Technologies and LLOYDS METALS

Assuming the 90 days trading horizon Orient Technologies Limited is expected to under-perform the LLOYDS METALS. In addition to that, Orient Technologies is 1.21 times more volatile than LLOYDS METALS AND. It trades about -0.08 of its total potential returns per unit of risk. LLOYDS METALS AND is currently generating about 0.04 per unit of volatility. If you would invest  121,515  in LLOYDS METALS AND on December 28, 2024 and sell it today you would earn a total of  7,300  from holding LLOYDS METALS AND or generate 6.01% return on investment over 90 days.

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

Orient Technologies Limited  vs.  LLOYDS METALS AND

Orient Technologies

Risk-Adjusted Performance

Very Weak

Over the last 90 days Orient Technologies Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's technical and fundamental indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

LLOYDS METALS AND

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in LLOYDS METALS AND are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, LLOYDS METALS may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Orient Technologies and LLOYDS METALS

The main advantage of trading using opposite Orient Technologies and LLOYDS METALS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Orient Technologies 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 Orient Technologies Limited 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.

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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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.