Correlation Between Zhihu and 65339KBY5

Can any of the company-specific risk be diversified away by investing in both Zhihu and 65339KBY5 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 Zhihu and 65339KBY5 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Zhihu Inc ADR and NEE 1875 15 JAN 27, you can compare the effects of market volatilities on Zhihu and 65339KBY5 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 Zhihu with a short position of 65339KBY5. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhihu and 65339KBY5.

Diversification Opportunities for Zhihu and 65339KBY5

-0.06

Correlation Coefficient

Zhihu  65339KBY5

Good diversification

The 3 months correlation between Zhihu and 65339KBY5 is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Zhihu Inc ADR and NEE 1875 15 JAN 27 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NEE 1875 15 and Zhihu 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 Zhihu Inc ADR are associated (or correlated) with 65339KBY5. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NEE 1875 15 has no effect on the direction of Zhihu i.e., Zhihu and 65339KBY5 go up and down completely randomly.

Pair Corralation between Zhihu and 65339KBY5

Allowing for the 90-day total investment horizon Zhihu Inc ADR is expected to under-perform the 65339KBY5. In addition to that, Zhihu is 1.19 times more volatile than NEE 1875 15 JAN 27. It trades about -0.27 of its total potential returns per unit of risk. NEE 1875 15 JAN 27 is currently generating about 0.03 per unit of volatility. If you would invest  9,462  in NEE 1875 15 JAN 27 on October 9, 2024 and sell it today you would earn a total of  53.00  from holding NEE 1875 15 JAN 27 or generate 0.56% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	95.0%
Values	Daily Returns

Zhihu Inc ADR  vs.  NEE 1875 15 JAN 27

Zhihu Inc ADR

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Zhihu Inc ADR has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unfluctuating performance, the Stock's technical indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

NEE 1875 15

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in NEE 1875 15 JAN 27 are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, 65339KBY5 is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Zhihu and 65339KBY5

The main advantage of trading using opposite Zhihu and 65339KBY5 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhihu position performs unexpectedly, 65339KBY5 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 65339KBY5 will offset losses from the drop in 65339KBY5's long position.

The idea behind Zhihu Inc ADR and NEE 1875 15 JAN 27 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.