Correlation Between EverQuote and Cheche Group
Can any of the company-specific risk be diversified away by investing in both EverQuote and Cheche Group 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 EverQuote and Cheche Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EverQuote Class A and Cheche Group Class, you can compare the effects of market volatilities on EverQuote and Cheche Group 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 EverQuote with a short position of Cheche Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of EverQuote and Cheche Group.
Diversification Opportunities for EverQuote and Cheche Group
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between EverQuote and Cheche is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding EverQuote Class A and Cheche Group Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cheche Group Class and EverQuote 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 EverQuote Class A are associated (or correlated) with Cheche Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cheche Group Class has no effect on the direction of EverQuote i.e., EverQuote and Cheche Group go up and down completely randomly.
Pair Corralation between EverQuote and Cheche Group
Given the investment horizon of 90 days EverQuote is expected to generate 1.26 times less return on investment than Cheche Group. But when comparing it to its historical volatility, EverQuote Class A is 1.01 times less risky than Cheche Group. It trades about 0.09 of its potential returns per unit of risk. Cheche Group Class is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 78.00 in Cheche Group Class on September 1, 2024 and sell it today you would earn a total of 7.00 from holding Cheche Group Class or generate 8.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
EverQuote Class A vs. Cheche Group Class
Performance |
| Timeline |
| EverQuote Class A |
| Cheche Group Class |
EverQuote and Cheche Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EverQuote and Cheche Group
The main advantage of trading using opposite EverQuote and Cheche Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EverQuote position performs unexpectedly, Cheche Group 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 Cheche Group will offset losses from the drop in Cheche Group's long position.| EverQuote vs. Onfolio Holdings | EverQuote vs. Vivid Seats | EverQuote vs. Asset Entities Class | EverQuote vs. Comscore |
| Cheche Group vs. ServiceNow | Cheche Group vs. Old Dominion Freight | Cheche Group vs. Procter Gamble | Cheche Group vs. Eastman Kodak Co |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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