Correlation Between Spark Networks and Lizhi
Can any of the company-specific risk be diversified away by investing in both Spark Networks and Lizhi 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 Spark Networks and Lizhi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Spark Networks SE and Lizhi Inc, you can compare the effects of market volatilities on Spark Networks and Lizhi 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 Spark Networks with a short position of Lizhi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Spark Networks and Lizhi.
Diversification Opportunities for Spark Networks and Lizhi
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Spark and Lizhi is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Spark Networks SE and Lizhi Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lizhi Inc and Spark Networks 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 Spark Networks SE are associated (or correlated) with Lizhi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lizhi Inc has no effect on the direction of Spark Networks i.e., Spark Networks and Lizhi go up and down completely randomly.
Pair Corralation between Spark Networks and Lizhi
Considering the 90-day investment horizon Spark Networks SE is expected to under-perform the Lizhi. In addition to that, Spark Networks is 2.51 times more volatile than Lizhi Inc. It trades about -0.27 of its total potential returns per unit of risk. Lizhi Inc is currently generating about -0.11 per unit of volatility. If you would invest 87.00 in Lizhi Inc on August 28, 2024 and sell it today you would lose (7.00) from holding Lizhi Inc or give up 8.05% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Spark Networks SE vs. Lizhi Inc
Performance |
| Timeline |
| Spark Networks SE |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Lizhi Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Spark Networks and Lizhi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Spark Networks and Lizhi
The main advantage of trading using opposite Spark Networks and Lizhi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Spark Networks position performs unexpectedly, Lizhi 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 Lizhi will offset losses from the drop in Lizhi's long position.| Spark Networks vs. Locafy Limited | Spark Networks vs. Metalpha Technology Holding | Spark Networks vs. TuanChe ADR | Spark Networks vs. Thryv Holdings |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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