Correlation Between VOXX International and Xiaomi Corp
Can any of the company-specific risk be diversified away by investing in both VOXX International and Xiaomi Corp 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 VOXX International and Xiaomi Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VOXX International and Xiaomi Corp ADR, you can compare the effects of market volatilities on VOXX International and Xiaomi Corp 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 VOXX International with a short position of Xiaomi Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of VOXX International and Xiaomi Corp.
Diversification Opportunities for VOXX International and Xiaomi Corp
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between VOXX and Xiaomi is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding VOXX International and Xiaomi Corp ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiaomi Corp ADR and VOXX International 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 VOXX International are associated (or correlated) with Xiaomi Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiaomi Corp ADR has no effect on the direction of VOXX International i.e., VOXX International and Xiaomi Corp go up and down completely randomly.
Pair Corralation between VOXX International and Xiaomi Corp
Given the investment horizon of 90 days VOXX International is expected to generate 26.85 times less return on investment than Xiaomi Corp. But when comparing it to its historical volatility, VOXX International is 8.54 times less risky than Xiaomi Corp. It trades about 0.08 of its potential returns per unit of risk. Xiaomi Corp ADR is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 1,964 in Xiaomi Corp ADR on October 20, 2024 and sell it today you would earn a total of 298.00 from holding Xiaomi Corp ADR or generate 15.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
VOXX International vs. Xiaomi Corp ADR
Performance |
| Timeline |
| VOXX International |
| Xiaomi Corp ADR |
VOXX International and Xiaomi Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VOXX International and Xiaomi Corp
The main advantage of trading using opposite VOXX International and Xiaomi Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VOXX International position performs unexpectedly, Xiaomi Corp 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 Xiaomi Corp will offset losses from the drop in Xiaomi Corp's long position.| VOXX International vs. LG Display Co | VOXX International vs. Emerson Radio | VOXX International vs. Universal Electronics | VOXX International vs. Samsung Electronics Co |
| Xiaomi Corp vs. Samsung Electronics Co | Xiaomi Corp vs. Sharp Corp ADR | Xiaomi Corp vs. LG Display Co | Xiaomi Corp vs. Universal Electronics |
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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Other Complementary Tools
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |