Correlation Between Onfolio Holdings and DouYu International
Can any of the company-specific risk be diversified away by investing in both Onfolio Holdings and DouYu 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 Onfolio Holdings and DouYu International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Onfolio Holdings and DouYu International Holdings, you can compare the effects of market volatilities on Onfolio Holdings and DouYu 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 Onfolio Holdings with a short position of DouYu International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Onfolio Holdings and DouYu International.
Diversification Opportunities for Onfolio Holdings and DouYu International
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Onfolio and DouYu is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Onfolio Holdings and DouYu International Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DouYu International and Onfolio Holdings 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 Onfolio Holdings are associated (or correlated) with DouYu International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DouYu International has no effect on the direction of Onfolio Holdings i.e., Onfolio Holdings and DouYu International go up and down completely randomly.
Pair Corralation between Onfolio Holdings and DouYu International
Given the investment horizon of 90 days Onfolio Holdings is expected to generate 2.87 times more return on investment than DouYu International. However, Onfolio Holdings is 2.87 times more volatile than DouYu International Holdings. It trades about 0.01 of its potential returns per unit of risk. DouYu International Holdings is currently generating about -0.38 per unit of risk. If you would invest 126.00 in Onfolio Holdings on January 13, 2025 and sell it today you would lose (14.00) from holding Onfolio Holdings or give up 11.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Onfolio Holdings vs. DouYu International Holdings
Performance |
| Timeline |
| Onfolio Holdings |
| DouYu International |
Onfolio Holdings and DouYu International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Onfolio Holdings and DouYu International
The main advantage of trading using opposite Onfolio Holdings and DouYu International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Onfolio Holdings position performs unexpectedly, DouYu 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 DouYu International will offset losses from the drop in DouYu International's long position.| Onfolio Holdings vs. Vivid Seats | Onfolio Holdings vs. EverQuote Class A | Onfolio Holdings vs. Asset Entities Class | Onfolio Holdings vs. Zhihu Inc ADR |
| DouYu International vs. Weibo Corp | DouYu International vs. Tencent Music Entertainment | DouYu International vs. Autohome | DouYu International vs. Tencent Holdings Ltd |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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