Correlation Between Autohome ADR and ANGI Homeservices
Can any of the company-specific risk be diversified away by investing in both Autohome ADR and ANGI Homeservices 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 Autohome ADR and ANGI Homeservices into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Autohome ADR and ANGI Homeservices, you can compare the effects of market volatilities on Autohome ADR and ANGI Homeservices 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 Autohome ADR with a short position of ANGI Homeservices. Check out your portfolio center. Please also check ongoing floating volatility patterns of Autohome ADR and ANGI Homeservices.
Diversification Opportunities for Autohome ADR and ANGI Homeservices
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Autohome and ANGI is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Autohome ADR and ANGI Homeservices in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANGI Homeservices and Autohome ADR 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 Autohome ADR are associated (or correlated) with ANGI Homeservices. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANGI Homeservices has no effect on the direction of Autohome ADR i.e., Autohome ADR and ANGI Homeservices go up and down completely randomly.
Pair Corralation between Autohome ADR and ANGI Homeservices
Assuming the 90 days trading horizon Autohome ADR is expected to generate 0.34 times more return on investment than ANGI Homeservices. However, Autohome ADR is 2.98 times less risky than ANGI Homeservices. It trades about 0.01 of its potential returns per unit of risk. ANGI Homeservices is currently generating about -0.08 per unit of risk. If you would invest 2,600 in Autohome ADR on August 29, 2024 and sell it today you would earn a total of 0.00 from holding Autohome ADR or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Autohome ADR vs. ANGI Homeservices
Performance |
| Timeline |
| Autohome ADR |
| ANGI Homeservices |
Autohome ADR and ANGI Homeservices Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Autohome ADR and ANGI Homeservices
The main advantage of trading using opposite Autohome ADR and ANGI Homeservices positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Autohome ADR position performs unexpectedly, ANGI Homeservices 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 ANGI Homeservices will offset losses from the drop in ANGI Homeservices' long position.| Autohome ADR vs. SCIENCE IN SPORT | Autohome ADR vs. Air Transport Services | Autohome ADR vs. AVITA Medical | Autohome ADR vs. Fukuyama Transporting Co |
| ANGI Homeservices vs. Webster Financial | ANGI Homeservices vs. ATOSS SOFTWARE | ANGI Homeservices vs. FORMPIPE SOFTWARE AB | ANGI Homeservices vs. CDN IMPERIAL BANK |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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