Correlation Between Fangdd Network and Avalon GloboCare
Can any of the company-specific risk be diversified away by investing in both Fangdd Network and Avalon GloboCare 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 Fangdd Network and Avalon GloboCare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fangdd Network Group and Avalon GloboCare Corp, you can compare the effects of market volatilities on Fangdd Network and Avalon GloboCare 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 Fangdd Network with a short position of Avalon GloboCare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fangdd Network and Avalon GloboCare.
Diversification Opportunities for Fangdd Network and Avalon GloboCare
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Fangdd and Avalon is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Fangdd Network Group and Avalon GloboCare Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Avalon GloboCare Corp and Fangdd Network 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 Fangdd Network Group are associated (or correlated) with Avalon GloboCare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Avalon GloboCare Corp has no effect on the direction of Fangdd Network i.e., Fangdd Network and Avalon GloboCare go up and down completely randomly.
Pair Corralation between Fangdd Network and Avalon GloboCare
Considering the 90-day investment horizon Fangdd Network Group is expected to under-perform the Avalon GloboCare. But the stock apears to be less risky and, when comparing its historical volatility, Fangdd Network Group is 1.31 times less risky than Avalon GloboCare. The stock trades about -0.07 of its potential returns per unit of risk. The Avalon GloboCare Corp is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 343.00 in Avalon GloboCare Corp on November 3, 2024 and sell it today you would lose (13.00) from holding Avalon GloboCare Corp or give up 3.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fangdd Network Group vs. Avalon GloboCare Corp
Performance |
| Timeline |
| Fangdd Network Group |
| Avalon GloboCare Corp |
Fangdd Network and Avalon GloboCare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fangdd Network and Avalon GloboCare
The main advantage of trading using opposite Fangdd Network and Avalon GloboCare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fangdd Network position performs unexpectedly, Avalon GloboCare 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 Avalon GloboCare will offset losses from the drop in Avalon GloboCare's long position.| Fangdd Network vs. Southcorp Capital | Fangdd Network vs. Frp Holdings Ord | Fangdd Network vs. Ucommune International | Fangdd Network vs. Ohmyhome Limited Ordinary |
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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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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