Correlation Between Cheche Group and MetLife Preferred
Can any of the company-specific risk be diversified away by investing in both Cheche Group and MetLife Preferred 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 Cheche Group and MetLife Preferred into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cheche Group Class and MetLife Preferred Stock, you can compare the effects of market volatilities on Cheche Group and MetLife Preferred 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 Cheche Group with a short position of MetLife Preferred. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cheche Group and MetLife Preferred.
Diversification Opportunities for Cheche Group and MetLife Preferred
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Cheche and MetLife is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Cheche Group Class and MetLife Preferred Stock in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MetLife Preferred Stock and Cheche 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 Cheche Group Class are associated (or correlated) with MetLife Preferred. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MetLife Preferred Stock has no effect on the direction of Cheche Group i.e., Cheche Group and MetLife Preferred go up and down completely randomly.
Pair Corralation between Cheche Group and MetLife Preferred
Considering the 90-day investment horizon Cheche Group Class is expected to generate 32.65 times more return on investment than MetLife Preferred. However, Cheche Group is 32.65 times more volatile than MetLife Preferred Stock. It trades about 0.2 of its potential returns per unit of risk. MetLife Preferred Stock is currently generating about 0.02 per unit of risk. If you would invest 93.00 in Cheche Group Class on November 27, 2024 and sell it today you would earn a total of 22.00 from holding Cheche Group Class or generate 23.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cheche Group Class vs. MetLife Preferred Stock
Performance |
| Timeline |
| Cheche Group Class |
| MetLife Preferred Stock |
Cheche Group and MetLife Preferred Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cheche Group and MetLife Preferred
The main advantage of trading using opposite Cheche Group and MetLife Preferred positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cheche Group position performs unexpectedly, MetLife Preferred 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 MetLife Preferred will offset losses from the drop in MetLife Preferred's long position.| Cheche Group vs. Freedom Holding Corp | Cheche Group vs. Playstudios | Cheche Group vs. Hasbro Inc | Cheche Group vs. Regeneron Pharmaceuticals |
| MetLife Preferred vs. Brighthouse Financial | MetLife Preferred vs. Brighthouse Financial | MetLife Preferred vs. MetLife Preferred Stock | MetLife Preferred vs. Brighthouse Financial |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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