Correlation Between Xunlei and Inuvo
Can any of the company-specific risk be diversified away by investing in both Xunlei and Inuvo 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 Xunlei and Inuvo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xunlei Ltd Adr and Inuvo Inc, you can compare the effects of market volatilities on Xunlei and Inuvo 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 Xunlei with a short position of Inuvo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xunlei and Inuvo.
Diversification Opportunities for Xunlei and Inuvo
Excellent diversification
The 3 months correlation between Xunlei and Inuvo is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Xunlei Ltd Adr and Inuvo Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inuvo Inc and Xunlei 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 Xunlei Ltd Adr are associated (or correlated) with Inuvo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inuvo Inc has no effect on the direction of Xunlei i.e., Xunlei and Inuvo go up and down completely randomly.
Pair Corralation between Xunlei and Inuvo
Given the investment horizon of 90 days Xunlei is expected to generate 1.29 times less return on investment than Inuvo. But when comparing it to its historical volatility, Xunlei Ltd Adr is 1.87 times less risky than Inuvo. It trades about 0.03 of its potential returns per unit of risk. Inuvo Inc is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 30.00 in Inuvo Inc on August 29, 2024 and sell it today you would lose (2.00) from holding Inuvo Inc or give up 6.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
Xunlei Ltd Adr vs. Inuvo Inc
Performance |
| Timeline |
| Xunlei Ltd Adr |
| Inuvo Inc |
Xunlei and Inuvo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xunlei and Inuvo
The main advantage of trading using opposite Xunlei and Inuvo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xunlei position performs unexpectedly, Inuvo 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 Inuvo will offset losses from the drop in Inuvo's long position.| Xunlei vs. Travelzoo | Xunlei vs. Emerald Expositions Events | Xunlei vs. Ziff Davis | Xunlei vs. Direct Digital Holdings |
| Inuvo vs. MGO Global Common | Inuvo vs. Baosheng Media Group | Inuvo vs. National CineMedia | Inuvo vs. Xunlei Ltd Adr |
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.
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