Correlation Between Yunji and Naas Technology
Can any of the company-specific risk be diversified away by investing in both Yunji and Naas 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 Yunji and Naas Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yunji Inc and Naas Technology ADR, you can compare the effects of market volatilities on Yunji and Naas 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 Yunji with a short position of Naas Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yunji and Naas Technology.
Diversification Opportunities for Yunji and Naas Technology
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Yunji and Naas is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Yunji Inc and Naas Technology ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Naas Technology ADR and Yunji 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 Yunji Inc are associated (or correlated) with Naas Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Naas Technology ADR has no effect on the direction of Yunji i.e., Yunji and Naas Technology go up and down completely randomly.
Pair Corralation between Yunji and Naas Technology
Allowing for the 90-day total investment horizon Yunji Inc is expected to generate 1.32 times more return on investment than Naas Technology. However, Yunji is 1.32 times more volatile than Naas Technology ADR. It trades about 0.04 of its potential returns per unit of risk. Naas Technology ADR is currently generating about -0.02 per unit of risk. If you would invest 176.00 in Yunji Inc on September 4, 2024 and sell it today you would earn a total of 2.00 from holding Yunji Inc or generate 1.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yunji Inc vs. Naas Technology ADR
Performance |
| Timeline |
| Yunji Inc |
| Naas Technology ADR |
Yunji and Naas Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yunji and Naas Technology
The main advantage of trading using opposite Yunji and Naas Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yunji position performs unexpectedly, Naas 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 Naas Technology will offset losses from the drop in Naas Technology's long position.The idea behind Yunji Inc and Naas Technology ADR pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Naas Technology vs. Leslies | Naas Technology vs. Sally Beauty Holdings | Naas Technology vs. ODP Corp | Naas Technology vs. 1 800 FLOWERSCOM |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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