Correlation Between Yunji and Envela Corp

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

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

Diversification Opportunities for Yunji and Envela Corp

-0.64

Correlation Coefficient

Yunji  Envela Corp

Excellent diversification

The 3 months correlation between Yunji and Envela is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Yunji Inc and Envela Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Envela Corp and Yunji 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 Yunji Inc are associated (or correlated) with Envela Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Envela Corp has no effect on the direction of Yunji i.e., Yunji and Envela Corp go up and down completely randomly.

Pair Corralation between Yunji and Envela Corp

Allowing for the 90-day total investment horizon Yunji Inc is expected to generate 1.82 times more return on investment than Envela Corp. However, Yunji is 1.82 times more volatile than Envela Corp. It trades about 0.06 of its potential returns per unit of risk. Envela Corp is currently generating about -0.11 per unit of risk. If you would invest  169.00  in Yunji Inc on December 27, 2024 and sell it today you would earn a total of  17.00  from holding Yunji Inc or generate 10.06% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.36%
Values	Daily Returns

Yunji Inc  vs.  Envela Corp

Yunji Inc

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Yunji Inc are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak forward-looking indicators, Yunji revealed solid returns over the last few months and may actually be approaching a breakup point.

Envela Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Envela Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite abnormal performance in the last few months, the Stock's essential indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Yunji and Envela Corp

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

The idea behind Yunji Inc and Envela Corp 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.