Correlation Between Atlanticus Holdings and Lexinfintech Holdings
Can any of the company-specific risk be diversified away by investing in both Atlanticus Holdings and Lexinfintech Holdings 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 Atlanticus Holdings and Lexinfintech Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atlanticus Holdings and Lexinfintech Holdings, you can compare the effects of market volatilities on Atlanticus Holdings and Lexinfintech Holdings 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 Atlanticus Holdings with a short position of Lexinfintech Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atlanticus Holdings and Lexinfintech Holdings.
Diversification Opportunities for Atlanticus Holdings and Lexinfintech Holdings
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Atlanticus and Lexinfintech is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Atlanticus Holdings and Lexinfintech Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lexinfintech Holdings and Atlanticus 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 Atlanticus Holdings are associated (or correlated) with Lexinfintech Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lexinfintech Holdings has no effect on the direction of Atlanticus Holdings i.e., Atlanticus Holdings and Lexinfintech Holdings go up and down completely randomly.
Pair Corralation between Atlanticus Holdings and Lexinfintech Holdings
Given the investment horizon of 90 days Atlanticus Holdings is expected to under-perform the Lexinfintech Holdings. In addition to that, Atlanticus Holdings is 1.21 times more volatile than Lexinfintech Holdings. It trades about -0.36 of its total potential returns per unit of risk. Lexinfintech Holdings is currently generating about -0.1 per unit of volatility. If you would invest 177.00 in Lexinfintech Holdings on January 25, 2024 and sell it today you would lose (8.00) from holding Lexinfintech Holdings or give up 4.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Atlanticus Holdings vs. Lexinfintech Holdings
Performance |
| Timeline |
| Atlanticus Holdings |
| Lexinfintech Holdings |
Atlanticus Holdings and Lexinfintech Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atlanticus Holdings and Lexinfintech Holdings
The main advantage of trading using opposite Atlanticus Holdings and Lexinfintech Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atlanticus Holdings position performs unexpectedly, Lexinfintech Holdings 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 Lexinfintech Holdings will offset losses from the drop in Lexinfintech Holdings' long position.| Atlanticus Holdings vs. Visa Class A | Atlanticus Holdings vs. Mastercard | Atlanticus Holdings vs. Oshidori International Holdings | Atlanticus Holdings vs. US70082LAB36 |
| Lexinfintech Holdings vs. Visa Class A | Lexinfintech Holdings vs. Mastercard | Lexinfintech Holdings vs. Oshidori International Holdings | Lexinfintech Holdings vs. US70082LAB36 |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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