Correlation Between Vivid Seats and Autohome
Can any of the company-specific risk be diversified away by investing in both Vivid Seats and Autohome 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 Vivid Seats and Autohome into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vivid Seats Warrant and Autohome, you can compare the effects of market volatilities on Vivid Seats and Autohome 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 Vivid Seats with a short position of Autohome. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vivid Seats and Autohome.
Diversification Opportunities for Vivid Seats and Autohome
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Vivid and Autohome is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Vivid Seats Warrant and Autohome in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Autohome and Vivid Seats 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 Vivid Seats Warrant are associated (or correlated) with Autohome. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Autohome has no effect on the direction of Vivid Seats i.e., Vivid Seats and Autohome go up and down completely randomly.
Pair Corralation between Vivid Seats and Autohome
Assuming the 90 days horizon Vivid Seats Warrant is expected to under-perform the Autohome. In addition to that, Vivid Seats is 5.39 times more volatile than Autohome. It trades about -0.02 of its total potential returns per unit of risk. Autohome is currently generating about 0.03 per unit of volatility. If you would invest 2,501 in Autohome on August 27, 2024 and sell it today you would earn a total of 259.00 from holding Autohome or generate 10.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vivid Seats Warrant vs. Autohome
Performance |
| Timeline |
| Vivid Seats Warrant |
| Autohome |
Vivid Seats and Autohome Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vivid Seats and Autohome
The main advantage of trading using opposite Vivid Seats and Autohome positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vivid Seats position performs unexpectedly, Autohome 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 Autohome will offset losses from the drop in Autohome's long position.| Vivid Seats vs. Vivid Seats | Vivid Seats vs. ReNew Energy Global | Vivid Seats vs. Reservoir Media Management |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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