Correlation Between YY and Phoenix New

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both YY and Phoenix New 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 YY and Phoenix New into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between YY Inc Class and Phoenix New Media, you can compare the effects of market volatilities on YY and Phoenix New 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 YY with a short position of Phoenix New. Check out your portfolio center. Please also check ongoing floating volatility patterns of YY and Phoenix New.

Diversification Opportunities for YY and Phoenix New

0.06
  Correlation Coefficient

Significant diversification

The 3 months correlation between YY and Phoenix is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding YY Inc Class and Phoenix New Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Phoenix New Media and YY 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 YY Inc Class are associated (or correlated) with Phoenix New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Phoenix New Media has no effect on the direction of YY i.e., YY and Phoenix New go up and down completely randomly.

Pair Corralation between YY and Phoenix New

Allowing for the 90-day total investment horizon YY Inc Class is expected to generate 0.39 times more return on investment than Phoenix New. However, YY Inc Class is 2.59 times less risky than Phoenix New. It trades about 0.13 of its potential returns per unit of risk. Phoenix New Media is currently generating about -0.13 per unit of risk. If you would invest  3,436  in YY Inc Class on August 23, 2024 and sell it today you would earn a total of  176.00  from holding YY Inc Class or generate 5.12% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

YY Inc Class  vs.  Phoenix New Media

 Performance 
       Timeline  
YY Inc Class 

Risk-Adjusted Performance

4 of 100

 
Weak
 
Strong
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in YY Inc Class are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, YY may actually be approaching a critical reversion point that can send shares even higher in December 2024.
Phoenix New Media 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Phoenix New Media has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in December 2024. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

YY and Phoenix New Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with YY and Phoenix New

The main advantage of trading using opposite YY and Phoenix New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if YY position performs unexpectedly, Phoenix New 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 Phoenix New will offset losses from the drop in Phoenix New's long position.
The idea behind YY Inc Class and Phoenix New Media 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.
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.

Other Complementary Tools

Funds Screener
Find actively-traded funds from around the world traded on over 30 global exchanges
Money Flow Index
Determine momentum by analyzing Money Flow Index and other technical indicators
Portfolio Backtesting
Avoid under-diversification and over-optimization by backtesting your portfolios
Earnings Calls
Check upcoming earnings announcements updated hourly across public exchanges
CEOs Directory
Screen CEOs from public companies around the world