Correlation Between One Group and Senmiao Technology
Can any of the company-specific risk be diversified away by investing in both One Group and Senmiao 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 One Group and Senmiao Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between One Group Hospitality and Senmiao Technology, you can compare the effects of market volatilities on One Group and Senmiao 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 One Group with a short position of Senmiao Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of One Group and Senmiao Technology.
Diversification Opportunities for One Group and Senmiao Technology
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between One and Senmiao is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding One Group Hospitality and Senmiao Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Senmiao Technology and One Group 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 One Group Hospitality are associated (or correlated) with Senmiao Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Senmiao Technology has no effect on the direction of One Group i.e., One Group and Senmiao Technology go up and down completely randomly.
Pair Corralation between One Group and Senmiao Technology
Given the investment horizon of 90 days One Group Hospitality is expected to under-perform the Senmiao Technology. But the stock apears to be less risky and, when comparing its historical volatility, One Group Hospitality is 1.6 times less risky than Senmiao Technology. The stock trades about -0.03 of its potential returns per unit of risk. The Senmiao Technology is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 90.00 in Senmiao Technology on November 9, 2024 and sell it today you would lose (1.00) from holding Senmiao Technology or give up 1.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
One Group Hospitality vs. Senmiao Technology
Performance |
| Timeline |
| One Group Hospitality |
| Senmiao Technology |
One Group and Senmiao Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with One Group and Senmiao Technology
The main advantage of trading using opposite One Group and Senmiao Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if One Group position performs unexpectedly, Senmiao 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 Senmiao Technology will offset losses from the drop in Senmiao Technology's long position.| One Group vs. FAT Brands | One Group vs. Potbelly Co | One Group vs. BJs Restaurants | One Group vs. Rave Restaurant Group |
| Senmiao Technology vs. X Financial Class | Senmiao Technology vs. Yirendai | Senmiao Technology vs. Pintec Technology Holdings | Senmiao Technology vs. Qudian Inc |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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