Correlation Between Better Home and Lufax Holding
Can any of the company-specific risk be diversified away by investing in both Better Home 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 Better Home and Lufax Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Better Home Finance and Lufax Holding, you can compare the effects of market volatilities on Better Home 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 Better Home with a short position of Lufax Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Better Home and Lufax Holding.
Diversification Opportunities for Better Home and Lufax Holding
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Better and Lufax is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Better Home Finance and Lufax Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lufax Holding and Better Home 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 Better Home Finance 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 Better Home i.e., Better Home and Lufax Holding go up and down completely randomly.
Pair Corralation between Better Home and Lufax Holding
Given the investment horizon of 90 days Better Home Finance is expected to under-perform the Lufax Holding. In addition to that, Better Home is 2.65 times more volatile than Lufax Holding. It trades about -0.18 of its total potential returns per unit of risk. Lufax Holding is currently generating about -0.17 per unit of volatility. If you would invest 289.00 in Lufax Holding on September 11, 2025 and sell it today you would lose (24.00) from holding Lufax Holding or give up 8.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Better Home Finance vs. Lufax Holding
Performance |
| Timeline |
| Better Home Finance |
| Lufax Holding |
Better Home and Lufax Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Better Home and Lufax Holding
The main advantage of trading using opposite Better Home and Lufax Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Better Home 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.| Better Home vs. Loandepot | Better Home vs. Encore Capital Group | Better Home vs. Bit Digital | Better Home vs. Guild Holdings Co |
| Lufax Holding vs. Navient Corp | Lufax Holding vs. Oaktree Specialty Lending | Lufax Holding vs. Jefferson Capital, Common | Lufax Holding vs. Better Home Finance |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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