Correlation Between Autohome and Asset Entities
Can any of the company-specific risk be diversified away by investing in both Autohome and Asset Entities 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 Asset Entities into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Autohome and Asset Entities Class, you can compare the effects of market volatilities on Autohome and Asset Entities 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 Asset Entities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Autohome and Asset Entities.
Diversification Opportunities for Autohome and Asset Entities
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Autohome and Asset is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Autohome and Asset Entities Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asset Entities Class 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 are associated (or correlated) with Asset Entities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asset Entities Class has no effect on the direction of Autohome i.e., Autohome and Asset Entities go up and down completely randomly.
Pair Corralation between Autohome and Asset Entities
Given the investment horizon of 90 days Autohome is expected to generate 0.41 times more return on investment than Asset Entities. However, Autohome is 2.45 times less risky than Asset Entities. It trades about -0.17 of its potential returns per unit of risk. Asset Entities Class is currently generating about -0.38 per unit of risk. If you would invest 2,962 in Autohome on August 27, 2024 and sell it today you would lose (236.00) from holding Autohome or give up 7.97% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Autohome vs. Asset Entities Class
Performance |
| Timeline |
| Autohome |
| Asset Entities Class |
Autohome and Asset Entities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Autohome and Asset Entities
The main advantage of trading using opposite Autohome and Asset Entities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Autohome position performs unexpectedly, Asset Entities 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 Asset Entities will offset losses from the drop in Asset Entities' long position.| Autohome vs. Hello Group | Autohome vs. Weibo Corp | Autohome vs. Tencent Music Entertainment | Autohome vs. DouYu International Holdings |
| Asset Entities vs. Trivago NV | Asset Entities vs. Cheetah Mobile | Asset Entities vs. Comscore | Asset Entities vs. Arena Group Holdings |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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