Correlation Between JX Luxventure and Levi Strauss

Can any of the company-specific risk be diversified away by investing in both JX Luxventure and Levi Strauss 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 JX Luxventure and Levi Strauss into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between JX Luxventure and Levi Strauss Co, you can compare the effects of market volatilities on JX Luxventure and Levi Strauss 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 JX Luxventure with a short position of Levi Strauss. Check out your portfolio center. Please also check ongoing floating volatility patterns of JX Luxventure and Levi Strauss.

Diversification Opportunities for JX Luxventure and Levi Strauss

-0.67

Correlation Coefficient

JX Luxventure  Levi Strauss

Excellent diversification

The 3 months correlation between LLL and Levi is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding JX Luxventure and Levi Strauss Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Levi Strauss and JX Luxventure 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 JX Luxventure are associated (or correlated) with Levi Strauss. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Levi Strauss has no effect on the direction of JX Luxventure i.e., JX Luxventure and Levi Strauss go up and down completely randomly.

Pair Corralation between JX Luxventure and Levi Strauss

Considering the 90-day investment horizon JX Luxventure is expected to under-perform the Levi Strauss. In addition to that, JX Luxventure is 2.06 times more volatile than Levi Strauss Co. It trades about -0.13 of its total potential returns per unit of risk. Levi Strauss Co is currently generating about 0.02 per unit of volatility. If you would invest  1,715  in Levi Strauss Co on January 17, 2024 and sell it today you would earn a total of  257.00  from holding Levi Strauss Co or generate 14.99% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	23.23%
Values	Daily Returns

JX Luxventure  vs.  Levi Strauss Co

JX Luxventure

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days JX Luxventure has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent essential indicators, JX Luxventure is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Levi Strauss

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Levi Strauss Co are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent basic indicators, Levi Strauss demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with JX Luxventure and Levi Strauss

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

The idea behind JX Luxventure and Levi Strauss Co 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.