Correlation Between Cheetah Mobile and RSTN Old
Can any of the company-specific risk be diversified away by investing in both Cheetah Mobile and RSTN Old 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 RSTN Old into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cheetah Mobile and RSTN Old, you can compare the effects of market volatilities on Cheetah Mobile and RSTN Old 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 RSTN Old. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cheetah Mobile and RSTN Old.
Diversification Opportunities for Cheetah Mobile and RSTN Old
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Cheetah and RSTN is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Cheetah Mobile and RSTN Old in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RSTN Old 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 RSTN Old. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RSTN Old has no effect on the direction of Cheetah Mobile i.e., Cheetah Mobile and RSTN Old go up and down completely randomly.
Pair Corralation between Cheetah Mobile and RSTN Old
Given the investment horizon of 90 days Cheetah Mobile is expected to generate 0.82 times more return on investment than RSTN Old. However, Cheetah Mobile is 1.23 times less risky than RSTN Old. It trades about 0.06 of its potential returns per unit of risk. RSTN Old is currently generating about -0.2 per unit of risk. If you would invest 351.00 in Cheetah Mobile on October 26, 2024 and sell it today you would earn a total of 94.00 from holding Cheetah Mobile or generate 26.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 58.54% |
| Values | Daily Returns |
Cheetah Mobile vs. RSTN Old
Performance |
| Timeline |
| Cheetah Mobile |
| RSTN Old |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Cheetah Mobile and RSTN Old Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cheetah Mobile and RSTN Old
The main advantage of trading using opposite Cheetah Mobile and RSTN Old positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cheetah Mobile position performs unexpectedly, RSTN Old 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 RSTN Old will offset losses from the drop in RSTN Old's long position.| Cheetah Mobile vs. Tuniu Corp | Cheetah Mobile vs. Yirendai | Cheetah Mobile vs. Xunlei Ltd Adr | Cheetah Mobile vs. Phoenix New Media |
| RSTN Old vs. Extreme Networks | RSTN Old vs. Terns Pharmaceuticals | RSTN Old vs. Genasys | RSTN Old vs. ADC Therapeutics SA |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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