Correlation Between Xiaomi Corp and Vizio Holding
Can any of the company-specific risk be diversified away by investing in both Xiaomi Corp and Vizio Holding 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 Xiaomi Corp and Vizio Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xiaomi Corp ADR and Vizio Holding Corp, you can compare the effects of market volatilities on Xiaomi Corp and Vizio Holding 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 Xiaomi Corp with a short position of Vizio Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiaomi Corp and Vizio Holding.
Diversification Opportunities for Xiaomi Corp and Vizio Holding
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Xiaomi and Vizio is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Xiaomi Corp ADR and Vizio Holding Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vizio Holding Corp and Xiaomi Corp 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 Xiaomi Corp ADR are associated (or correlated) with Vizio Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vizio Holding Corp has no effect on the direction of Xiaomi Corp i.e., Xiaomi Corp and Vizio Holding go up and down completely randomly.
Pair Corralation between Xiaomi Corp and Vizio Holding
Assuming the 90 days horizon Xiaomi Corp ADR is expected to generate 4.8 times more return on investment than Vizio Holding. However, Xiaomi Corp is 4.8 times more volatile than Vizio Holding Corp. It trades about 0.22 of its potential returns per unit of risk. Vizio Holding Corp is currently generating about 0.05 per unit of risk. If you would invest 1,577 in Xiaomi Corp ADR on August 23, 2024 and sell it today you would earn a total of 232.00 from holding Xiaomi Corp ADR or generate 14.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xiaomi Corp ADR vs. Vizio Holding Corp
Performance |
| Timeline |
| Xiaomi Corp ADR |
| Vizio Holding Corp |
Xiaomi Corp and Vizio Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiaomi Corp and Vizio Holding
The main advantage of trading using opposite Xiaomi Corp and Vizio Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiaomi Corp position performs unexpectedly, Vizio Holding 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 Vizio Holding will offset losses from the drop in Vizio Holding's long position.| Xiaomi Corp vs. Samsung Electronics Co | Xiaomi Corp vs. Sharp Corp ADR | Xiaomi Corp vs. LG Display Co | Xiaomi Corp vs. Vizio Holding Corp |
| Vizio Holding vs. Universal Electronics | Vizio Holding vs. VOXX International | Vizio Holding vs. Samsung Electronics Co | Vizio Holding vs. Sony Group Corp |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Equity Valuation Check real value of public entities based on technical and fundamental data |