Correlation Between Vasta Platform and Xunlei
Can any of the company-specific risk be diversified away by investing in both Vasta Platform and Xunlei 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 Vasta Platform and Xunlei into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vasta Platform and Xunlei Ltd Adr, you can compare the effects of market volatilities on Vasta Platform and Xunlei 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 Vasta Platform with a short position of Xunlei. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vasta Platform and Xunlei.
Diversification Opportunities for Vasta Platform and Xunlei
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Vasta and Xunlei is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Vasta Platform and Xunlei Ltd Adr in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xunlei Ltd Adr and Vasta Platform 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 Vasta Platform are associated (or correlated) with Xunlei. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xunlei Ltd Adr has no effect on the direction of Vasta Platform i.e., Vasta Platform and Xunlei go up and down completely randomly.
Pair Corralation between Vasta Platform and Xunlei
Given the investment horizon of 90 days Vasta Platform is expected to under-perform the Xunlei. But the stock apears to be less risky and, when comparing its historical volatility, Vasta Platform is 1.13 times less risky than Xunlei. The stock trades about -0.01 of its potential returns per unit of risk. The Xunlei Ltd Adr is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 186.00 in Xunlei Ltd Adr on November 2, 2024 and sell it today you would earn a total of 74.00 from holding Xunlei Ltd Adr or generate 39.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vasta Platform vs. Xunlei Ltd Adr
Performance |
| Timeline |
| Vasta Platform |
| Xunlei Ltd Adr |
Vasta Platform and Xunlei Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vasta Platform and Xunlei
The main advantage of trading using opposite Vasta Platform and Xunlei positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vasta Platform position performs unexpectedly, Xunlei 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 Xunlei will offset losses from the drop in Xunlei's long position.| Vasta Platform vs. Strategic Education | Vasta Platform vs. Grand Canyon Education | Vasta Platform vs. Universal Technical Institute | Vasta Platform vs. Laureate Education |
| Xunlei vs. Travelzoo | Xunlei vs. Emerald Expositions Events | Xunlei vs. Ziff Davis | Xunlei vs. Direct Digital 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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