Correlation Between SOFI TECHNOLOGIES and ANHUI CONCH
Can any of the company-specific risk be diversified away by investing in both SOFI TECHNOLOGIES and ANHUI CONCH 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 SOFI TECHNOLOGIES and ANHUI CONCH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SOFI TECHNOLOGIES and ANHUI CH H , you can compare the effects of market volatilities on SOFI TECHNOLOGIES and ANHUI CONCH 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 SOFI TECHNOLOGIES with a short position of ANHUI CONCH. Check out your portfolio center. Please also check ongoing floating volatility patterns of SOFI TECHNOLOGIES and ANHUI CONCH.
Diversification Opportunities for SOFI TECHNOLOGIES and ANHUI CONCH
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SOFI and ANHUI is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding SOFI TECHNOLOGIES and ANHUI CH H in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANHUI CONCH and SOFI TECHNOLOGIES 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 SOFI TECHNOLOGIES are associated (or correlated) with ANHUI CONCH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANHUI CONCH has no effect on the direction of SOFI TECHNOLOGIES i.e., SOFI TECHNOLOGIES and ANHUI CONCH go up and down completely randomly.
Pair Corralation between SOFI TECHNOLOGIES and ANHUI CONCH
Assuming the 90 days horizon SOFI TECHNOLOGIES is expected to generate 1.05 times more return on investment than ANHUI CONCH. However, SOFI TECHNOLOGIES is 1.05 times more volatile than ANHUI CH H . It trades about 0.08 of its potential returns per unit of risk. ANHUI CH H is currently generating about 0.03 per unit of risk. If you would invest 440.00 in SOFI TECHNOLOGIES on September 4, 2024 and sell it today you would earn a total of 1,124 from holding SOFI TECHNOLOGIES or generate 255.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SOFI TECHNOLOGIES vs. ANHUI CH H
Performance |
| Timeline |
| SOFI TECHNOLOGIES |
| ANHUI CONCH |
SOFI TECHNOLOGIES and ANHUI CONCH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SOFI TECHNOLOGIES and ANHUI CONCH
The main advantage of trading using opposite SOFI TECHNOLOGIES and ANHUI CONCH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SOFI TECHNOLOGIES position performs unexpectedly, ANHUI CONCH 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 ANHUI CONCH will offset losses from the drop in ANHUI CONCH's long position.| SOFI TECHNOLOGIES vs. Apple Inc | SOFI TECHNOLOGIES vs. Apple Inc | SOFI TECHNOLOGIES vs. Apple Inc | SOFI TECHNOLOGIES vs. Apple Inc |
| ANHUI CONCH vs. NetSol Technologies | ANHUI CONCH vs. Safety Insurance Group | ANHUI CONCH vs. SOFI TECHNOLOGIES | ANHUI CONCH vs. Calibre Mining Corp |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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