Correlation Between Chindata Group and IQIYI

Can any of the company-specific risk be diversified away by investing in both Chindata Group and IQIYI 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 Chindata Group and IQIYI into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Chindata Group Holdings and iQIYI Inc, you can compare the effects of market volatilities on Chindata Group and IQIYI 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 Chindata Group with a short position of IQIYI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chindata Group and IQIYI.

Diversification Opportunities for Chindata Group and IQIYI

-0.59

Correlation Coefficient

Chindata Group  IQIYI

Excellent diversification

The 3 months correlation between Chindata and IQIYI is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Chindata Group Holdings and iQIYI Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iQIYI Inc and Chindata Group 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 Chindata Group Holdings are associated (or correlated) with IQIYI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iQIYI Inc has no effect on the direction of Chindata Group i.e., Chindata Group and IQIYI go up and down completely randomly.

Pair Corralation between Chindata Group and IQIYI

If you would invest  790.00  in Chindata Group Holdings on September 21, 2024 and sell it today you would earn a total of  0.00  from holding Chindata Group Holdings or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	2.33%
Values	Daily Returns

Chindata Group Holdings  vs.  iQIYI Inc

Chindata Group Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Chindata Group Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound fundamental indicators, Chindata Group is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

iQIYI Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days iQIYI Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, IQIYI is not utilizing all of its potentials. The newest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Chindata Group and IQIYI

The main advantage of trading using opposite Chindata Group and IQIYI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chindata Group position performs unexpectedly, IQIYI 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 IQIYI will offset losses from the drop in IQIYI's long position.

The idea behind Chindata Group Holdings and iQIYI Inc 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.

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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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.