Correlation Between SIERRA METALS and Autohome
Can any of the company-specific risk be diversified away by investing in both SIERRA METALS and Autohome 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 SIERRA METALS and Autohome into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SIERRA METALS and Autohome ADR, you can compare the effects of market volatilities on SIERRA METALS and Autohome 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 SIERRA METALS with a short position of Autohome. Check out your portfolio center. Please also check ongoing floating volatility patterns of SIERRA METALS and Autohome.
Diversification Opportunities for SIERRA METALS and Autohome
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between SIERRA and Autohome is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding SIERRA METALS and Autohome ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Autohome ADR and SIERRA METALS 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 SIERRA METALS are associated (or correlated) with Autohome. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Autohome ADR has no effect on the direction of SIERRA METALS i.e., SIERRA METALS and Autohome go up and down completely randomly.
Pair Corralation between SIERRA METALS and Autohome
Assuming the 90 days trading horizon SIERRA METALS is expected to generate 2.24 times less return on investment than Autohome. But when comparing it to its historical volatility, SIERRA METALS is 2.04 times less risky than Autohome. It trades about 0.16 of its potential returns per unit of risk. Autohome ADR is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 2,378 in Autohome ADR on October 23, 2024 and sell it today you would earn a total of 282.00 from holding Autohome ADR or generate 11.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SIERRA METALS vs. Autohome ADR
Performance |
| Timeline |
| SIERRA METALS |
| Autohome ADR |
SIERRA METALS and Autohome Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SIERRA METALS and Autohome
The main advantage of trading using opposite SIERRA METALS and Autohome positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SIERRA METALS position performs unexpectedly, Autohome 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 Autohome will offset losses from the drop in Autohome's long position.| SIERRA METALS vs. Apple Inc | SIERRA METALS vs. Apple Inc | SIERRA METALS vs. Apple Inc | SIERRA METALS vs. Apple Inc |
| Autohome vs. Aluminum of | Autohome vs. G III Apparel Group | Autohome vs. DAIDO METAL TD | Autohome vs. SIERRA METALS |
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.
Other Complementary Tools
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals |