Correlation Between Lizhi and MYT Netherlands
Can any of the company-specific risk be diversified away by investing in both Lizhi and MYT Netherlands 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 Lizhi and MYT Netherlands into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lizhi Inc and MYT Netherlands Parent, you can compare the effects of market volatilities on Lizhi and MYT Netherlands 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 Lizhi with a short position of MYT Netherlands. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lizhi and MYT Netherlands.
Diversification Opportunities for Lizhi and MYT Netherlands
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Lizhi and MYT is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Lizhi Inc and MYT Netherlands Parent in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MYT Netherlands Parent and Lizhi 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 Lizhi Inc are associated (or correlated) with MYT Netherlands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MYT Netherlands Parent has no effect on the direction of Lizhi i.e., Lizhi and MYT Netherlands go up and down completely randomly.
Pair Corralation between Lizhi and MYT Netherlands
Given the investment horizon of 90 days Lizhi is expected to generate 4.98 times less return on investment than MYT Netherlands. In addition to that, Lizhi is 1.07 times more volatile than MYT Netherlands Parent. It trades about 0.02 of its total potential returns per unit of risk. MYT Netherlands Parent is currently generating about 0.11 per unit of volatility. If you would invest 266.00 in MYT Netherlands Parent on November 3, 2024 and sell it today you would earn a total of 621.00 from holding MYT Netherlands Parent or generate 233.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lizhi Inc vs. MYT Netherlands Parent
Performance |
| Timeline |
| Lizhi Inc |
| MYT Netherlands Parent |
Lizhi and MYT Netherlands Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lizhi and MYT Netherlands
The main advantage of trading using opposite Lizhi and MYT Netherlands positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lizhi position performs unexpectedly, MYT Netherlands 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 MYT Netherlands will offset losses from the drop in MYT Netherlands' long position.| Lizhi vs. Bank of New | Lizhi vs. AA Mission Acquisition | Lizhi vs. FS KKR Capital | Lizhi vs. Futuretech II Acquisition |
| MYT Netherlands vs. Movado Group | MYT Netherlands vs. Envela Corp | MYT Netherlands vs. Tapestry | MYT Netherlands vs. Capri 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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