Correlation Between Freedom Holding and Cheche Group
Can any of the company-specific risk be diversified away by investing in both Freedom Holding 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 Freedom Holding and Cheche Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Freedom Holding Corp and Cheche Group Class, you can compare the effects of market volatilities on Freedom Holding 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 Freedom Holding with a short position of Cheche Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Freedom Holding and Cheche Group.
Diversification Opportunities for Freedom Holding and Cheche Group
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Freedom and Cheche is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Freedom Holding Corp 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 Freedom Holding 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 Freedom Holding Corp 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 Freedom Holding i.e., Freedom Holding and Cheche Group go up and down completely randomly.
Pair Corralation between Freedom Holding and Cheche Group
Given the investment horizon of 90 days Freedom Holding Corp is expected to generate 0.26 times more return on investment than Cheche Group. However, Freedom Holding Corp is 3.83 times less risky than Cheche Group. It trades about 0.11 of its potential returns per unit of risk. Cheche Group Class is currently generating about -0.05 per unit of risk. If you would invest 7,249 in Freedom Holding Corp on October 16, 2024 and sell it today you would earn a total of 5,247 from holding Freedom Holding Corp or generate 72.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Freedom Holding Corp vs. Cheche Group Class
Performance |
| Timeline |
| Freedom Holding Corp |
| Cheche Group Class |
Freedom Holding and Cheche Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Freedom Holding and Cheche Group
The main advantage of trading using opposite Freedom Holding and Cheche Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Freedom Holding 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.| Freedom Holding vs. Nomura Holdings ADR | Freedom Holding vs. Scully Royalty | Freedom Holding vs. Oppenheimer Holdings | Freedom Holding vs. Houlihan Lokey |
| Cheche Group vs. Zillow Group Class | Cheche Group vs. Kanzhun Ltd ADR | Cheche Group vs. Outbrain | Cheche Group vs. TuanChe ADR |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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