Correlation Between Autohome and ADRIATIC METALS
Can any of the company-specific risk be diversified away by investing in both Autohome and ADRIATIC METALS 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 and ADRIATIC METALS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Autohome ADR and ADRIATIC METALS LS 013355, you can compare the effects of market volatilities on Autohome and ADRIATIC METALS 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 with a short position of ADRIATIC METALS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Autohome and ADRIATIC METALS.
Diversification Opportunities for Autohome and ADRIATIC METALS
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Autohome and ADRIATIC is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Autohome ADR and ADRIATIC METALS LS 013355 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ADRIATIC METALS LS and Autohome 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 ADRIATIC METALS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ADRIATIC METALS LS has no effect on the direction of Autohome i.e., Autohome and ADRIATIC METALS go up and down completely randomly.
Pair Corralation between Autohome and ADRIATIC METALS
Assuming the 90 days trading horizon Autohome ADR is expected to under-perform the ADRIATIC METALS. But the stock apears to be less risky and, when comparing its historical volatility, Autohome ADR is 1.48 times less risky than ADRIATIC METALS. The stock trades about -0.06 of its potential returns per unit of risk. The ADRIATIC METALS LS 013355 is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 248.00 in ADRIATIC METALS LS 013355 on September 2, 2024 and sell it today you would lose (2.00) from holding ADRIATIC METALS LS 013355 or give up 0.81% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Autohome ADR vs. ADRIATIC METALS LS 013355
Performance |
| Timeline |
| Autohome ADR |
| ADRIATIC METALS LS |
Autohome and ADRIATIC METALS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Autohome and ADRIATIC METALS
The main advantage of trading using opposite Autohome and ADRIATIC METALS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Autohome position performs unexpectedly, ADRIATIC METALS 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 ADRIATIC METALS will offset losses from the drop in ADRIATIC METALS's long position.| Autohome vs. Alphabet Class A | Autohome vs. Tencent Holdings | Autohome vs. Prosus NV | Autohome vs. AIRBNB INC DL 01 |
| ADRIATIC METALS vs. NAKED WINES PLC | ADRIATIC METALS vs. China BlueChemical | ADRIATIC METALS vs. Eastman Chemical | ADRIATIC METALS vs. United Rentals |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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