Correlation Between Leju Holdings and Seluxit AS

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

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

Diversification Opportunities for Leju Holdings and Seluxit AS

-0.07

Correlation Coefficient

Leju Holdings  Seluxit AS

Good diversification

The 3 months correlation between Leju and Seluxit is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Leju Holdings Limited and Seluxit AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seluxit AS and Leju 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 Leju Holdings Limited are associated (or correlated) with Seluxit AS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seluxit AS has no effect on the direction of Leju Holdings i.e., Leju Holdings and Seluxit AS go up and down completely randomly.

Pair Corralation between Leju Holdings and Seluxit AS

Given the investment horizon of 90 days Leju Holdings Limited is expected to under-perform the Seluxit AS. In addition to that, Leju Holdings is 4.05 times more volatile than Seluxit AS. It trades about -0.42 of its total potential returns per unit of risk. Seluxit AS is currently generating about 0.05 per unit of volatility. If you would invest  340.00  in Seluxit AS on January 25, 2024 and sell it today you would earn a total of  10.00  from holding Seluxit AS or generate 2.94% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	75.0%
Values	Daily Returns

Leju Holdings Limited  vs.  Seluxit AS

Leju Holdings Limited

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Leju Holdings Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's forward-looking indicators remain comparatively stable which may send shares a bit higher in May 2024. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Seluxit AS

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Seluxit AS are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating basic indicators, Seluxit AS exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Leju Holdings and Seluxit AS

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

The idea behind Leju Holdings Limited and Seluxit AS 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.