Correlation Between Exchange Bankshares and Kuaishou Technology
Can any of the company-specific risk be diversified away by investing in both Exchange Bankshares and Kuaishou Technology 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 Exchange Bankshares and Kuaishou Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Exchange Bankshares and Kuaishou Technology, you can compare the effects of market volatilities on Exchange Bankshares and Kuaishou Technology 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 Exchange Bankshares with a short position of Kuaishou Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exchange Bankshares and Kuaishou Technology.
Diversification Opportunities for Exchange Bankshares and Kuaishou Technology
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Exchange and Kuaishou is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Exchange Bankshares and Kuaishou Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kuaishou Technology and Exchange Bankshares 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 Exchange Bankshares are associated (or correlated) with Kuaishou Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kuaishou Technology has no effect on the direction of Exchange Bankshares i.e., Exchange Bankshares and Kuaishou Technology go up and down completely randomly.
Pair Corralation between Exchange Bankshares and Kuaishou Technology
Given the investment horizon of 90 days Exchange Bankshares is expected to generate 0.01 times more return on investment than Kuaishou Technology. However, Exchange Bankshares is 105.59 times less risky than Kuaishou Technology. It trades about 0.24 of its potential returns per unit of risk. Kuaishou Technology is currently generating about -0.17 per unit of risk. If you would invest 4,775 in Exchange Bankshares on October 25, 2024 and sell it today you would earn a total of 15.00 from holding Exchange Bankshares or generate 0.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 85.71% |
| Values | Daily Returns |
Exchange Bankshares vs. Kuaishou Technology
Performance |
| Timeline |
| Exchange Bankshares |
| Kuaishou Technology |
Exchange Bankshares and Kuaishou Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Exchange Bankshares and Kuaishou Technology
The main advantage of trading using opposite Exchange Bankshares and Kuaishou Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exchange Bankshares position performs unexpectedly, Kuaishou Technology 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 Kuaishou Technology will offset losses from the drop in Kuaishou Technology's long position.| Exchange Bankshares vs. First Community Financial | Exchange Bankshares vs. National Capital Bank | Exchange Bankshares vs. Oakworth Capital | Exchange Bankshares vs. Truxton |
| Kuaishou Technology vs. Tencent Holdings | Kuaishou Technology vs. DouYu International Holdings | Kuaishou Technology vs. Tencent Music Entertainment | Kuaishou Technology vs. Weibo Corp |
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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