Correlation Between EPlay Digital and RLX TECH
Can any of the company-specific risk be diversified away by investing in both EPlay Digital and RLX TECH 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 EPlay Digital and RLX TECH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ePlay Digital and RLX TECH SPADR1, you can compare the effects of market volatilities on EPlay Digital and RLX TECH 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 EPlay Digital with a short position of RLX TECH. Check out your portfolio center. Please also check ongoing floating volatility patterns of EPlay Digital and RLX TECH.
Diversification Opportunities for EPlay Digital and RLX TECH
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between EPlay and RLX is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ePlay Digital and RLX TECH SPADR1 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RLX TECH SPADR1 and EPlay Digital 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 ePlay Digital are associated (or correlated) with RLX TECH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RLX TECH SPADR1 has no effect on the direction of EPlay Digital i.e., EPlay Digital and RLX TECH go up and down completely randomly.
Pair Corralation between EPlay Digital and RLX TECH
Assuming the 90 days trading horizon ePlay Digital is expected to generate 44.09 times more return on investment than RLX TECH. However, EPlay Digital is 44.09 times more volatile than RLX TECH SPADR1. It trades about 0.16 of its potential returns per unit of risk. RLX TECH SPADR1 is currently generating about 0.04 per unit of risk. If you would invest 0.45 in ePlay Digital on September 12, 2024 and sell it today you would lose (0.35) from holding ePlay Digital or give up 77.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ePlay Digital vs. RLX TECH SPADR1
Performance |
| Timeline |
| ePlay Digital |
| RLX TECH SPADR1 |
EPlay Digital and RLX TECH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EPlay Digital and RLX TECH
The main advantage of trading using opposite EPlay Digital and RLX TECH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EPlay Digital position performs unexpectedly, RLX TECH 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 RLX TECH will offset losses from the drop in RLX TECH's long position.| EPlay Digital vs. Universal Display | EPlay Digital vs. ACCSYS TECHPLC EO | EPlay Digital vs. TRAVEL LEISURE DL 01 | EPlay Digital vs. Lion Biotechnologies |
| RLX TECH vs. ANTA SPORTS PRODUCT | RLX TECH vs. VIVA WINE GROUP | RLX TECH vs. ePlay Digital | RLX TECH vs. SYSTEMAIR AB |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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