Correlation Between IQIYI and 36Kr Holdings
Can any of the company-specific risk be diversified away by investing in both IQIYI and 36Kr Holdings 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 IQIYI and 36Kr Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iQIYI Inc and 36Kr Holdings, you can compare the effects of market volatilities on IQIYI and 36Kr Holdings 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 IQIYI with a short position of 36Kr Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of IQIYI and 36Kr Holdings.
Diversification Opportunities for IQIYI and 36Kr Holdings
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between IQIYI and 36Kr is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding iQIYI Inc and 36Kr Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 36Kr Holdings and IQIYI 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 iQIYI Inc are associated (or correlated) with 36Kr Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 36Kr Holdings has no effect on the direction of IQIYI i.e., IQIYI and 36Kr Holdings go up and down completely randomly.
Pair Corralation between IQIYI and 36Kr Holdings
Allowing for the 90-day total investment horizon iQIYI Inc is expected to under-perform the 36Kr Holdings. But the stock apears to be less risky and, when comparing its historical volatility, iQIYI Inc is 1.95 times less risky than 36Kr Holdings. The stock trades about -0.18 of its potential returns per unit of risk. The 36Kr Holdings is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 320.00 in 36Kr Holdings on October 25, 2024 and sell it today you would earn a total of 37.00 from holding 36Kr Holdings or generate 11.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
iQIYI Inc vs. 36Kr Holdings
Performance |
| Timeline |
| iQIYI Inc |
| 36Kr Holdings |
IQIYI and 36Kr Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IQIYI and 36Kr Holdings
The main advantage of trading using opposite IQIYI and 36Kr Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IQIYI position performs unexpectedly, 36Kr Holdings 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 36Kr Holdings will offset losses from the drop in 36Kr Holdings' long position.The idea behind iQIYI Inc and 36Kr Holdings pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| 36Kr Holdings vs. Yunji Inc | 36Kr Holdings vs. Fangdd Network Group | 36Kr Holdings vs. Huize Holding | 36Kr Holdings vs. MOGU Inc |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
Other Complementary Tools
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation |