Correlation Between Alibaba Group and MOGU
Can any of the company-specific risk be diversified away by investing in both Alibaba Group and MOGU 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 Alibaba Group and MOGU into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alibaba Group Holding and MOGU Inc, you can compare the effects of market volatilities on Alibaba Group and MOGU 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 Alibaba Group with a short position of MOGU. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alibaba Group and MOGU.
Diversification Opportunities for Alibaba Group and MOGU
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Alibaba and MOGU is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Alibaba Group Holding and MOGU Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MOGU Inc and Alibaba Group 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 Alibaba Group Holding are associated (or correlated) with MOGU. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MOGU Inc has no effect on the direction of Alibaba Group i.e., Alibaba Group and MOGU go up and down completely randomly.
Pair Corralation between Alibaba Group and MOGU
Assuming the 90 days horizon Alibaba Group Holding is expected to under-perform the MOGU. But the pink sheet apears to be less risky and, when comparing its historical volatility, Alibaba Group Holding is 1.16 times less risky than MOGU. The pink sheet trades about -0.12 of its potential returns per unit of risk. The MOGU Inc is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 195.00 in MOGU Inc on August 25, 2024 and sell it today you would earn a total of 18.00 from holding MOGU Inc or generate 9.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alibaba Group Holding vs. MOGU Inc
Performance |
| Timeline |
| Alibaba Group Holding |
| MOGU Inc |
Alibaba Group and MOGU Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alibaba Group and MOGU
The main advantage of trading using opposite Alibaba Group and MOGU positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alibaba Group position performs unexpectedly, MOGU 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 MOGU will offset losses from the drop in MOGU's long position.| Alibaba Group vs. Meituan ADR | Alibaba Group vs. Meituan | Alibaba Group vs. Qurate Retail Series | Alibaba Group vs. ThredUp |
| MOGU vs. iPower Inc | MOGU vs. LightInTheBox Holding Co | MOGU vs. Qurate Retail Series | MOGU vs. Kidpik 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
Other Complementary Tools
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |