Correlation Between Sentage Holdings and Lufax Holding

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

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

Diversification Opportunities for Sentage Holdings and Lufax Holding

-0.05

Correlation Coefficient

Sentage Holdings  Lufax Holding

Good diversification

The 3 months correlation between Sentage and Lufax is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Sentage Holdings and Lufax Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lufax Holding and Sentage Holdings 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 Sentage Holdings are associated (or correlated) with Lufax Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lufax Holding has no effect on the direction of Sentage Holdings i.e., Sentage Holdings and Lufax Holding go up and down completely randomly.

Pair Corralation between Sentage Holdings and Lufax Holding

Given the investment horizon of 90 days Sentage Holdings is expected to generate 4.18 times less return on investment than Lufax Holding. In addition to that, Sentage Holdings is 1.31 times more volatile than Lufax Holding. It trades about 0.02 of its total potential returns per unit of risk. Lufax Holding is currently generating about 0.12 per unit of volatility. If you would invest  240.00  in Lufax Holding on December 28, 2024 and sell it today you would earn a total of  66.00  from holding Lufax Holding or generate 27.5% return on investment over 90 days.

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

Sentage Holdings  vs.  Lufax Holding

Sentage Holdings

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Sentage Holdings are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady basic indicators, Sentage Holdings may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Lufax Holding

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Lufax Holding are ranked lower than 9 (%) 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.

Pair Trading with Sentage Holdings and Lufax Holding

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

The idea behind Sentage Holdings and Lufax Holding 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.