Correlation Between Asset Entities and YY
Can any of the company-specific risk be diversified away by investing in both Asset Entities and YY 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 Asset Entities and YY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asset Entities Class and YY Inc Class, you can compare the effects of market volatilities on Asset Entities and YY 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 Asset Entities with a short position of YY. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asset Entities and YY.
Diversification Opportunities for Asset Entities and YY
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Asset and YY is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Asset Entities Class and YY Inc Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YY Inc Class and Asset Entities 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 Asset Entities Class are associated (or correlated) with YY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YY Inc Class has no effect on the direction of Asset Entities i.e., Asset Entities and YY go up and down completely randomly.
Pair Corralation between Asset Entities and YY
Given the investment horizon of 90 days Asset Entities Class is expected to under-perform the YY. In addition to that, Asset Entities is 4.69 times more volatile than YY Inc Class. It trades about -0.02 of its total potential returns per unit of risk. YY Inc Class is currently generating about 0.02 per unit of volatility. If you would invest 3,773 in YY Inc Class on September 2, 2024 and sell it today you would earn a total of 112.00 from holding YY Inc Class or generate 2.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asset Entities Class vs. YY Inc Class
Performance |
| Timeline |
| Asset Entities Class |
| YY Inc Class |
Asset Entities and YY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asset Entities and YY
The main advantage of trading using opposite Asset Entities and YY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asset Entities position performs unexpectedly, YY 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 YY will offset losses from the drop in YY's long position.| Asset Entities vs. Tencent Music Entertainment | Asset Entities vs. Weibo Corp | Asset Entities vs. DouYu International Holdings | Asset Entities vs. Baidu Inc |
| YY vs. Weibo Corp | YY vs. DouYu International Holdings | YY vs. Tencent Music Entertainment | YY vs. Autohome |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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