Correlation Between Autohome and PropertyGuru
Can any of the company-specific risk be diversified away by investing in both Autohome and PropertyGuru 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 PropertyGuru into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Autohome and PropertyGuru Group, you can compare the effects of market volatilities on Autohome and PropertyGuru 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 PropertyGuru. Check out your portfolio center. Please also check ongoing floating volatility patterns of Autohome and PropertyGuru.
Diversification Opportunities for Autohome and PropertyGuru
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Autohome and PropertyGuru is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Autohome and PropertyGuru Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PropertyGuru Group 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 PropertyGuru. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PropertyGuru Group has no effect on the direction of Autohome i.e., Autohome and PropertyGuru go up and down completely randomly.
Pair Corralation between Autohome and PropertyGuru
Given the investment horizon of 90 days Autohome is expected to under-perform the PropertyGuru. But the stock apears to be less risky and, when comparing its historical volatility, Autohome is 1.18 times less risky than PropertyGuru. The stock trades about -0.01 of its potential returns per unit of risk. The PropertyGuru Group is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 471.00 in PropertyGuru Group on August 27, 2024 and sell it today you would earn a total of 193.00 from holding PropertyGuru Group or generate 40.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Autohome vs. PropertyGuru Group
Performance |
| Timeline |
| Autohome |
| PropertyGuru Group |
Autohome and PropertyGuru Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Autohome and PropertyGuru
The main advantage of trading using opposite Autohome and PropertyGuru positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Autohome position performs unexpectedly, PropertyGuru 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 PropertyGuru will offset losses from the drop in PropertyGuru's long position.| Autohome vs. Hello Group | Autohome vs. Weibo Corp | Autohome vs. Tencent Music Entertainment | Autohome vs. DouYu International Holdings |
| PropertyGuru vs. Comscore | PropertyGuru vs. Cheetah Mobile | PropertyGuru vs. EverQuote Class A | PropertyGuru vs. DouYu International 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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