Correlation Between FinVolution and EZCORP
Can any of the company-specific risk be diversified away by investing in both FinVolution and EZCORP 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 FinVolution and EZCORP into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FinVolution Group and EZCORP Inc, you can compare the effects of market volatilities on FinVolution and EZCORP 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 FinVolution with a short position of EZCORP. Check out your portfolio center. Please also check ongoing floating volatility patterns of FinVolution and EZCORP.
Diversification Opportunities for FinVolution and EZCORP
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between FinVolution and EZCORP is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding FinVolution Group and EZCORP Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EZCORP Inc and FinVolution 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 FinVolution Group are associated (or correlated) with EZCORP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EZCORP Inc has no effect on the direction of FinVolution i.e., FinVolution and EZCORP go up and down completely randomly.
Pair Corralation between FinVolution and EZCORP
Given the investment horizon of 90 days FinVolution is expected to generate 3.0 times less return on investment than EZCORP. In addition to that, FinVolution is 1.91 times more volatile than EZCORP Inc. It trades about 0.04 of its total potential returns per unit of risk. EZCORP Inc is currently generating about 0.25 per unit of volatility. If you would invest 1,082 in EZCORP Inc on August 28, 2024 and sell it today you would earn a total of 180.00 from holding EZCORP Inc or generate 16.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
FinVolution Group vs. EZCORP Inc
Performance |
| Timeline |
| FinVolution Group |
| EZCORP Inc |
FinVolution and EZCORP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FinVolution and EZCORP
The main advantage of trading using opposite FinVolution and EZCORP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FinVolution position performs unexpectedly, EZCORP 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 EZCORP will offset losses from the drop in EZCORP's long position.| FinVolution vs. SLM Corp | FinVolution vs. Orix Corp Ads | FinVolution vs. FirstCash | FinVolution vs. Medallion Financial 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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