Correlation Between Yirendai and Dunxin Financial
Can any of the company-specific risk be diversified away by investing in both Yirendai and Dunxin Financial 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 Yirendai and Dunxin Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yirendai and Dunxin Financial Holdings, you can compare the effects of market volatilities on Yirendai and Dunxin Financial 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 Yirendai with a short position of Dunxin Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yirendai and Dunxin Financial.
Diversification Opportunities for Yirendai and Dunxin Financial
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Yirendai and Dunxin is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Yirendai and Dunxin Financial Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dunxin Financial Holdings and Yirendai 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 Yirendai are associated (or correlated) with Dunxin Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dunxin Financial Holdings has no effect on the direction of Yirendai i.e., Yirendai and Dunxin Financial go up and down completely randomly.
Pair Corralation between Yirendai and Dunxin Financial
If you would invest 3.50 in Dunxin Financial Holdings on August 28, 2024 and sell it today you would earn a total of 0.00 from holding Dunxin Financial Holdings or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Yirendai vs. Dunxin Financial Holdings
Performance |
| Timeline |
| Yirendai |
| Dunxin Financial Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Yirendai and Dunxin Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yirendai and Dunxin Financial
The main advantage of trading using opposite Yirendai and Dunxin Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yirendai position performs unexpectedly, Dunxin Financial 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 Dunxin Financial will offset losses from the drop in Dunxin Financial's long position.| Yirendai vs. Lexinfintech Holdings | Yirendai vs. FinVolution Group | Yirendai vs. 360 Finance | Yirendai vs. Navient Corp |
| Dunxin Financial vs. MDJM | Dunxin Financial vs. ReTo Eco Solutions | Dunxin Financial vs. Four Seasons Education | Dunxin Financial vs. Mercurity Fintech Holding |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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