Correlation Between Hello and YY
Can any of the company-specific risk be diversified away by investing in both Hello and YY 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 Hello and YY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hello Group and YY Inc Class, you can compare the effects of market volatilities on Hello and YY 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 Hello with a short position of YY. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hello and YY.
Diversification Opportunities for Hello and YY
Average diversification
The 3 months correlation between Hello and YY is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Hello Group and YY Inc Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YY Inc Class and Hello 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 Hello Group are associated (or correlated) with YY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YY Inc Class has no effect on the direction of Hello i.e., Hello and YY go up and down completely randomly.
Pair Corralation between Hello and YY
Given the investment horizon of 90 days Hello Group is expected to under-perform the YY. But the stock apears to be less risky and, when comparing its historical volatility, Hello Group is 1.02 times less risky than YY. The stock trades about -0.22 of its potential returns per unit of risk. The YY Inc Class is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 3,400 in YY Inc Class on August 27, 2024 and sell it today you would lose (9.00) from holding YY Inc Class or give up 0.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hello Group vs. YY Inc Class
Performance |
| Timeline |
| Hello Group |
| YY Inc Class |
Hello and YY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hello and YY
The main advantage of trading using opposite Hello and YY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hello position performs unexpectedly, YY 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 YY will offset losses from the drop in YY's long position.| Hello vs. Weibo Corp | Hello vs. Autohome | Hello vs. Tencent Music Entertainment | Hello vs. DouYu International Holdings |
| YY vs. Weibo Corp | YY vs. DouYu International Holdings | YY vs. Tencent Music Entertainment | YY vs. Autohome |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Other Complementary Tools
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes |