Correlation Between Tuniu Corp and Atour Lifestyle

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

By analyzing existing cross correlation between Tuniu Corp and Atour Lifestyle Holdings, you can compare the effects of market volatilities on Tuniu Corp and Atour Lifestyle 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 Tuniu Corp with a short position of Atour Lifestyle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tuniu Corp and Atour Lifestyle.

Diversification Opportunities for Tuniu Corp and Atour Lifestyle

0.57

Correlation Coefficient

Tuniu Corp  Atour Lifestyle

Very weak diversification

The 3 months correlation between Tuniu and Atour is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Tuniu Corp and Atour Lifestyle Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atour Lifestyle Holdings and Tuniu Corp 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 Tuniu Corp are associated (or correlated) with Atour Lifestyle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atour Lifestyle Holdings has no effect on the direction of Tuniu Corp i.e., Tuniu Corp and Atour Lifestyle go up and down completely randomly.

Pair Corralation between Tuniu Corp and Atour Lifestyle

Given the investment horizon of 90 days Tuniu Corp is expected to generate 0.86 times more return on investment than Atour Lifestyle. However, Tuniu Corp is 1.17 times less risky than Atour Lifestyle. It trades about 0.06 of its potential returns per unit of risk. Atour Lifestyle Holdings is currently generating about 0.04 per unit of risk. If you would invest  99.00  in Tuniu Corp on December 25, 2024 and sell it today you would earn a total of  7.00  from holding Tuniu Corp or generate 7.07% return on investment over 90 days.

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

Tuniu Corp  vs.  Atour Lifestyle Holdings

Tuniu Corp

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Tuniu Corp are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Tuniu Corp may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Atour Lifestyle Holdings

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Atour Lifestyle Holdings are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, Atour Lifestyle may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Tuniu Corp and Atour Lifestyle

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

The idea behind Tuniu Corp and Atour Lifestyle Holdings 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.