Correlation Between Lexinfintech Holdings and Green Dot

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

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

Diversification Opportunities for Lexinfintech Holdings and Green Dot

-0.44

Correlation Coefficient

Lexinfintech Holdings  Green Dot

Very good diversification

The 3 months correlation between Lexinfintech and Green is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Lexinfintech Holdings and Green Dot in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Green Dot and Lexinfintech 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 Lexinfintech Holdings are associated (or correlated) with Green Dot. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Green Dot has no effect on the direction of Lexinfintech Holdings i.e., Lexinfintech Holdings and Green Dot go up and down completely randomly.

Pair Corralation between Lexinfintech Holdings and Green Dot

Allowing for the 90-day total investment horizon Lexinfintech Holdings is expected to under-perform the Green Dot. But the stock apears to be less risky and, when comparing its historical volatility, Lexinfintech Holdings is 1.05 times less risky than Green Dot. The stock trades about -0.09 of its potential returns per unit of risk. The Green Dot is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  812.00  in Green Dot on May 5, 2025 and sell it today you would earn a total of  176.00  from holding Green Dot or generate 21.67% return on investment over 90 days.

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

Lexinfintech Holdings  vs.  Green Dot

Lexinfintech Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days Lexinfintech Holdings 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 basic indicators remain fairly strong which may send shares a bit higher in September 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Green Dot

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Green Dot are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Green Dot unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Lexinfintech Holdings and Green Dot

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

The idea behind Lexinfintech Holdings and Green Dot 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 CEOs Directory module to screen CEOs from public companies around the world.