Correlation Between Senmiao Technology and One Group
Can any of the company-specific risk be diversified away by investing in both Senmiao Technology and One Group 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 Senmiao Technology and One Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Senmiao Technology and One Group Hospitality, you can compare the effects of market volatilities on Senmiao Technology and One Group 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 Senmiao Technology with a short position of One Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Senmiao Technology and One Group.
Diversification Opportunities for Senmiao Technology and One Group
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Senmiao and One is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Senmiao Technology and One Group Hospitality in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on One Group Hospitality and Senmiao Technology 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 Senmiao Technology are associated (or correlated) with One Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of One Group Hospitality has no effect on the direction of Senmiao Technology i.e., Senmiao Technology and One Group go up and down completely randomly.
Pair Corralation between Senmiao Technology and One Group
Given the investment horizon of 90 days Senmiao Technology is expected to generate 1.6 times more return on investment than One Group. However, Senmiao Technology is 1.6 times more volatile than One Group Hospitality. It trades about 0.03 of its potential returns per unit of risk. One Group Hospitality is currently generating about -0.03 per unit of risk. If you would invest 90.00 in Senmiao Technology on November 9, 2024 and sell it today you would lose (1.00) from holding Senmiao Technology or give up 1.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Senmiao Technology vs. One Group Hospitality
Performance |
| Timeline |
| Senmiao Technology |
| One Group Hospitality |
Senmiao Technology and One Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Senmiao Technology and One Group
The main advantage of trading using opposite Senmiao Technology and One Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Senmiao Technology position performs unexpectedly, One Group 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 One Group will offset losses from the drop in One Group's long position.| Senmiao Technology vs. X Financial Class | Senmiao Technology vs. Yirendai | Senmiao Technology vs. Pintec Technology Holdings | Senmiao Technology vs. Qudian Inc |
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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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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