Correlation Between SohuCom and Snail,

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

By analyzing existing cross correlation between SohuCom and Snail, Class A, you can compare the effects of market volatilities on SohuCom and Snail, 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 SohuCom with a short position of Snail,. Check out your portfolio center. Please also check ongoing floating volatility patterns of SohuCom and Snail,.

Diversification Opportunities for SohuCom and Snail,

0.05

Correlation Coefficient

SohuCom  Snail,

Significant diversification

The 3 months correlation between SohuCom and Snail, is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding SohuCom and Snail, Class A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Snail, Class A and SohuCom 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 SohuCom are associated (or correlated) with Snail,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Snail, Class A has no effect on the direction of SohuCom i.e., SohuCom and Snail, go up and down completely randomly.

Pair Corralation between SohuCom and Snail,

Given the investment horizon of 90 days SohuCom is expected to generate 0.29 times more return on investment than Snail,. However, SohuCom is 3.44 times less risky than Snail,. It trades about 0.01 of its potential returns per unit of risk. Snail, Class A is currently generating about -0.05 per unit of risk. If you would invest  1,335  in SohuCom on December 30, 2024 and sell it today you would lose (6.00) from holding SohuCom or give up 0.45% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

SohuCom  vs.  Snail, Class A

SohuCom

Risk-Adjusted Performance

Very Weak

Over the last 90 days SohuCom has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable technical indicators, SohuCom is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Snail, Class A

Risk-Adjusted Performance

Very Weak

Over the last 90 days Snail, Class A has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with SohuCom and Snail,

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

The idea behind SohuCom and Snail, Class A 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.