Correlation Between Atlanticus Holdings and Yirendai
Can any of the company-specific risk be diversified away by investing in both Atlanticus Holdings and Yirendai 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 Atlanticus Holdings and Yirendai into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atlanticus Holdings and Yirendai, you can compare the effects of market volatilities on Atlanticus Holdings and Yirendai 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 Atlanticus Holdings with a short position of Yirendai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atlanticus Holdings and Yirendai.
Diversification Opportunities for Atlanticus Holdings and Yirendai
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Atlanticus and Yirendai is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Atlanticus Holdings and Yirendai in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yirendai and Atlanticus Holdings 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 Atlanticus Holdings are associated (or correlated) with Yirendai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yirendai has no effect on the direction of Atlanticus Holdings i.e., Atlanticus Holdings and Yirendai go up and down completely randomly.
Pair Corralation between Atlanticus Holdings and Yirendai
Given the investment horizon of 90 days Atlanticus Holdings is expected to generate 0.46 times more return on investment than Yirendai. However, Atlanticus Holdings is 2.18 times less risky than Yirendai. It trades about 0.76 of its potential returns per unit of risk. Yirendai is currently generating about -0.07 per unit of risk. If you would invest 3,728 in Atlanticus Holdings on September 2, 2024 and sell it today you would earn a total of 2,098 from holding Atlanticus Holdings or generate 56.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Atlanticus Holdings vs. Yirendai
Performance |
| Timeline |
| Atlanticus Holdings |
| Yirendai |
Atlanticus Holdings and Yirendai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atlanticus Holdings and Yirendai
The main advantage of trading using opposite Atlanticus Holdings and Yirendai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atlanticus Holdings position performs unexpectedly, Yirendai 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 Yirendai will offset losses from the drop in Yirendai's long position.| Atlanticus Holdings vs. 360 Finance | Atlanticus Holdings vs. Lexinfintech Holdings | Atlanticus Holdings vs. Qudian Inc | Atlanticus Holdings vs. Enova International |
| Yirendai vs. Lexinfintech Holdings | Yirendai vs. FinVolution Group | Yirendai vs. 360 Finance | Yirendai vs. Navient Corp |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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