Correlation Between Lufax Holding and Hut 8

Can any of the company-specific risk be diversified away by investing in both Lufax Holding and Hut 8 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 Lufax Holding and Hut 8 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Lufax Holding and Hut 8 Corp, you can compare the effects of market volatilities on Lufax Holding and Hut 8 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 Lufax Holding with a short position of Hut 8. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lufax Holding and Hut 8.

Diversification Opportunities for Lufax Holding and Hut 8

-0.49

Correlation Coefficient

Lufax Holding  Hut 8

Very good diversification

The 3 months correlation between Lufax and Hut is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Lufax Holding and Hut 8 Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hut 8 Corp and Lufax Holding 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 Lufax Holding are associated (or correlated) with Hut 8. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hut 8 Corp has no effect on the direction of Lufax Holding i.e., Lufax Holding and Hut 8 go up and down completely randomly.

Pair Corralation between Lufax Holding and Hut 8

Allowing for the 90-day total investment horizon Lufax Holding is expected to generate 1.46 times less return on investment than Hut 8. But when comparing it to its historical volatility, Lufax Holding is 1.39 times less risky than Hut 8. It trades about 0.04 of its potential returns per unit of risk. Hut 8 Corp is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  922.00  in Hut 8 Corp on January 17, 2025 and sell it today you would earn a total of  186.00  from holding Hut 8 Corp or generate 20.17% return on investment over 90 days.

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

Lufax Holding  vs.  Hut 8 Corp

Lufax Holding

Risk-Adjusted Performance

Very Weak

Over the last 90 days Lufax Holding has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Lufax Holding is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Hut 8 Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Hut 8 Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in May 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Lufax Holding and Hut 8

The main advantage of trading using opposite Lufax Holding and Hut 8 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lufax Holding position performs unexpectedly, Hut 8 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 Hut 8 will offset losses from the drop in Hut 8's long position.

The idea behind Lufax Holding and Hut 8 Corp 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.