Correlation Between Sabio Holdings and Kuaishou Technology
Can any of the company-specific risk be diversified away by investing in both Sabio Holdings and Kuaishou Technology 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 Sabio Holdings and Kuaishou Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sabio Holdings and Kuaishou Technology, you can compare the effects of market volatilities on Sabio Holdings and Kuaishou Technology 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 Sabio Holdings with a short position of Kuaishou Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sabio Holdings and Kuaishou Technology.
Diversification Opportunities for Sabio Holdings and Kuaishou Technology
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sabio and Kuaishou is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Sabio Holdings and Kuaishou Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kuaishou Technology and Sabio 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 Sabio Holdings are associated (or correlated) with Kuaishou Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kuaishou Technology has no effect on the direction of Sabio Holdings i.e., Sabio Holdings and Kuaishou Technology go up and down completely randomly.
Pair Corralation between Sabio Holdings and Kuaishou Technology
Assuming the 90 days horizon Sabio Holdings is expected to generate 22.72 times less return on investment than Kuaishou Technology. But when comparing it to its historical volatility, Sabio Holdings is 1.35 times less risky than Kuaishou Technology. It trades about 0.0 of its potential returns per unit of risk. Kuaishou Technology is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 85.00 in Kuaishou Technology on August 24, 2024 and sell it today you would earn a total of 41.00 from holding Kuaishou Technology or generate 48.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sabio Holdings vs. Kuaishou Technology
Performance |
| Timeline |
| Sabio Holdings |
| Kuaishou Technology |
Sabio Holdings and Kuaishou Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sabio Holdings and Kuaishou Technology
The main advantage of trading using opposite Sabio Holdings and Kuaishou Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sabio Holdings position performs unexpectedly, Kuaishou Technology 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 Kuaishou Technology will offset losses from the drop in Kuaishou Technology's long position.| Sabio Holdings vs. Tencent Holdings | Sabio Holdings vs. Trivago NV | Sabio Holdings vs. YY Inc Class | Sabio Holdings vs. DouYu International Holdings |
| Kuaishou Technology vs. Tencent Holdings | Kuaishou Technology vs. Trivago NV | Kuaishou Technology vs. YY Inc Class | Kuaishou Technology vs. DouYu International 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Stocks Directory Find actively traded stocks across global markets | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format |