Correlation Between Lizhi and Fiverr International
Can any of the company-specific risk be diversified away by investing in both Lizhi and Fiverr International 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 Lizhi and Fiverr International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lizhi Inc and Fiverr International, you can compare the effects of market volatilities on Lizhi and Fiverr International 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 Lizhi with a short position of Fiverr International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lizhi and Fiverr International.
Diversification Opportunities for Lizhi and Fiverr International
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Lizhi and Fiverr is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Lizhi Inc and Fiverr International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fiverr International and Lizhi 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 Lizhi Inc are associated (or correlated) with Fiverr International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fiverr International has no effect on the direction of Lizhi i.e., Lizhi and Fiverr International go up and down completely randomly.
Pair Corralation between Lizhi and Fiverr International
If you would invest 2,926 in Fiverr International on September 1, 2024 and sell it today you would earn a total of 335.00 from holding Fiverr International or generate 11.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Lizhi Inc vs. Fiverr International
Performance |
| Timeline |
| Lizhi Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Fiverr International |
Lizhi and Fiverr International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lizhi and Fiverr International
The main advantage of trading using opposite Lizhi and Fiverr International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lizhi position performs unexpectedly, Fiverr International 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 Fiverr International will offset losses from the drop in Fiverr International's long position.The idea behind Lizhi Inc and Fiverr International 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.| Fiverr International vs. Snap Inc | Fiverr International vs. Twilio Inc | Fiverr International vs. Spotify Technology SA | Fiverr International vs. Baidu 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
Other Complementary Tools
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk |