Correlation Between X Financial and Upstart Holdings
Can any of the company-specific risk be diversified away by investing in both X Financial and Upstart Holdings 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 X Financial and Upstart Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between X Financial Class and Upstart Holdings, you can compare the effects of market volatilities on X Financial and Upstart Holdings 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 X Financial with a short position of Upstart Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of X Financial and Upstart Holdings.
Diversification Opportunities for X Financial and Upstart Holdings
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between XYF and Upstart is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding X Financial Class and Upstart Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Upstart Holdings and X Financial 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 X Financial Class are associated (or correlated) with Upstart Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Upstart Holdings has no effect on the direction of X Financial i.e., X Financial and Upstart Holdings go up and down completely randomly.
Pair Corralation between X Financial and Upstart Holdings
Considering the 90-day investment horizon X Financial Class is expected to generate 0.8 times more return on investment than Upstart Holdings. However, X Financial Class is 1.25 times less risky than Upstart Holdings. It trades about 0.23 of its potential returns per unit of risk. Upstart Holdings is currently generating about -0.04 per unit of risk. If you would invest 842.00 in X Financial Class on December 27, 2024 and sell it today you would earn a total of 689.00 from holding X Financial Class or generate 81.83% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
X Financial Class vs. Upstart Holdings
Performance |
Timeline |
X Financial Class |
Upstart Holdings |
X Financial and Upstart Holdings Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with X Financial and Upstart Holdings
The main advantage of trading using opposite X Financial and Upstart Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if X Financial position performs unexpectedly, Upstart Holdings 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 Upstart Holdings will offset losses from the drop in Upstart Holdings' long position.X Financial vs. LM Funding America | X Financial vs. Eason Technology Limited | X Financial vs. Nisun International Enterprise | X Financial vs. Qudian Inc |
Upstart Holdings vs. SoFi Technologies | Upstart Holdings vs. Visa Class A | Upstart Holdings vs. Mastercard | Upstart Holdings vs. American Express |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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