Correlation Between Ziff Davis and Xunlei
Can any of the company-specific risk be diversified away by investing in both Ziff Davis and Xunlei 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 Ziff Davis and Xunlei into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ziff Davis and Xunlei Ltd Adr, you can compare the effects of market volatilities on Ziff Davis and Xunlei 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 Ziff Davis with a short position of Xunlei. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ziff Davis and Xunlei.
Diversification Opportunities for Ziff Davis and Xunlei
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Ziff and Xunlei is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Ziff Davis and Xunlei Ltd Adr in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xunlei Ltd Adr and Ziff Davis 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 Ziff Davis are associated (or correlated) with Xunlei. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xunlei Ltd Adr has no effect on the direction of Ziff Davis i.e., Ziff Davis and Xunlei go up and down completely randomly.
Pair Corralation between Ziff Davis and Xunlei
Allowing for the 90-day total investment horizon Ziff Davis is expected to under-perform the Xunlei. But the stock apears to be less risky and, when comparing its historical volatility, Ziff Davis is 2.05 times less risky than Xunlei. The stock trades about -0.03 of its potential returns per unit of risk. The Xunlei Ltd Adr is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest 210.00 in Xunlei Ltd Adr on November 2, 2024 and sell it today you would earn a total of 50.00 from holding Xunlei Ltd Adr or generate 23.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ziff Davis vs. Xunlei Ltd Adr
Performance |
| Timeline |
| Ziff Davis |
| Xunlei Ltd Adr |
Ziff Davis and Xunlei Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ziff Davis and Xunlei
The main advantage of trading using opposite Ziff Davis and Xunlei positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ziff Davis position performs unexpectedly, Xunlei 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 Xunlei will offset losses from the drop in Xunlei's long position.| Ziff Davis vs. Interpublic Group of | Ziff Davis vs. Criteo Sa | Ziff Davis vs. WPP PLC ADR | Ziff Davis vs. Integral Ad Science |
| Xunlei vs. Travelzoo | Xunlei vs. Emerald Expositions Events | Xunlei vs. Ziff Davis | Xunlei vs. Direct Digital Holdings |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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