Correlation Between Cheetah Mobile and Onfolio Holdings
Can any of the company-specific risk be diversified away by investing in both Cheetah Mobile and Onfolio Holdings 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 Cheetah Mobile and Onfolio Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cheetah Mobile and Onfolio Holdings, you can compare the effects of market volatilities on Cheetah Mobile and Onfolio Holdings 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 Cheetah Mobile with a short position of Onfolio Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cheetah Mobile and Onfolio Holdings.
Diversification Opportunities for Cheetah Mobile and Onfolio Holdings
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Cheetah and Onfolio is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Cheetah Mobile and Onfolio Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Onfolio Holdings and Cheetah Mobile 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 Cheetah Mobile are associated (or correlated) with Onfolio Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Onfolio Holdings has no effect on the direction of Cheetah Mobile i.e., Cheetah Mobile and Onfolio Holdings go up and down completely randomly.
Pair Corralation between Cheetah Mobile and Onfolio Holdings
Given the investment horizon of 90 days Cheetah Mobile is expected to generate 0.64 times more return on investment than Onfolio Holdings. However, Cheetah Mobile is 1.56 times less risky than Onfolio Holdings. It trades about -0.16 of its potential returns per unit of risk. Onfolio Holdings is currently generating about -0.15 per unit of risk. If you would invest 560.00 in Cheetah Mobile on December 24, 2024 and sell it today you would lose (63.00) from holding Cheetah Mobile or give up 11.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cheetah Mobile vs. Onfolio Holdings
Performance |
| Timeline |
| Cheetah Mobile |
| Onfolio Holdings |
Cheetah Mobile and Onfolio Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cheetah Mobile and Onfolio Holdings
The main advantage of trading using opposite Cheetah Mobile and Onfolio Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cheetah Mobile position performs unexpectedly, Onfolio Holdings 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 Onfolio Holdings will offset losses from the drop in Onfolio Holdings' long position.| Cheetah Mobile vs. Tuniu Corp | Cheetah Mobile vs. Yirendai | Cheetah Mobile vs. Xunlei Ltd Adr | Cheetah Mobile vs. Phoenix New Media |
| Onfolio Holdings vs. Vivid Seats | Onfolio Holdings vs. EverQuote Class A | Onfolio Holdings vs. Asset Entities Class | Onfolio Holdings vs. Zhihu Inc ADR |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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