Correlation Between Yirendai and Nisun International
Can any of the company-specific risk be diversified away by investing in both Yirendai and Nisun International 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 Nisun International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yirendai and Nisun International Enterprise, you can compare the effects of market volatilities on Yirendai and Nisun International 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 Nisun International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yirendai and Nisun International.
Diversification Opportunities for Yirendai and Nisun International
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Yirendai and Nisun is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Yirendai and Nisun International Enterprise in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nisun International 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 Nisun International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nisun International has no effect on the direction of Yirendai i.e., Yirendai and Nisun International go up and down completely randomly.
Pair Corralation between Yirendai and Nisun International
Considering the 90-day investment horizon Yirendai is expected to under-perform the Nisun International. But the stock apears to be less risky and, when comparing its historical volatility, Yirendai is 1.51 times less risky than Nisun International. The stock trades about -0.19 of its potential returns per unit of risk. The Nisun International Enterprise is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest 929.00 in Nisun International Enterprise on August 28, 2024 and sell it today you would lose (107.00) from holding Nisun International Enterprise or give up 11.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yirendai vs. Nisun International Enterprise
Performance |
| Timeline |
| Yirendai |
| Nisun International |
Yirendai and Nisun International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yirendai and Nisun International
The main advantage of trading using opposite Yirendai and Nisun International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yirendai position performs unexpectedly, Nisun International 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 Nisun International will offset losses from the drop in Nisun International's long position.| Yirendai vs. Lexinfintech Holdings | Yirendai vs. FinVolution Group | Yirendai vs. 360 Finance | Yirendai vs. Navient Corp |
| Nisun International vs. Sentage Holdings | Nisun International vs. Yirendai | Nisun International vs. Lexinfintech Holdings | Nisun International vs. Lufax 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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