Rlx Technology Stock Volatility
| RLX Stock | USD 2.00 0.02 0.99% |
At this stage we consider RLX Stock to be very risky. RLX Technology maintains Sharpe Ratio (i.e., Efficiency) of 0.032, which implies the firm had a 0.032 % return per unit of risk over the last 3 months. We have found thirty technical indicators for RLX Technology, which you can use to evaluate the volatility of the company. Please check RLX Technology's Semi Deviation of 3.6, coefficient of variation of 3127.99, and Risk Adjusted Performance of 0.0357 to confirm if the risk estimate we provide is consistent with the expected return of 0.11%. Key indicators related to RLX Technology's volatility include:
90 Days Market Risk | Chance Of Distress | 90 Days Economic Sensitivity |
RLX Technology Stock volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of RLX daily returns, and it is calculated using variance and standard deviation. We also use RLX's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of RLX Technology volatility.
RLX |
Since volatility provides investors with entry points to take advantage of stock prices, companies, such as RLX Technology can benefit from it. Downward market volatility can be a perfect environment for investors who play the long game. Here, they may decide to buy additional stocks of RLX Technology at lower prices. For example, an investor can purchase RLX stock that has halved in price over a short period. This will lower your average cost per share, thereby improving your portfolio's performance when the markets normalize. Similarly, when the prices of RLX Technology's stock rises, investors can sell out and invest the proceeds in other equities with better opportunities. Investing when markets are volatile with better valuations will accord both investors and companies the opportunity to generate better long-term returns.
Moving together with RLX Stock
Moving against RLX Stock
| 0.62 | BG | Bunge Limited | PairCorr |
| 0.46 | XXII | 22nd Century Group Earnings Call This Week | PairCorr |
| 0.39 | LW | Lamb Weston Holdings | PairCorr |
RLX Technology Market Sensitivity And Downside Risk
RLX Technology's beta coefficient measures the volatility of RLX stock compared to the systematic risk of the entire market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents RLX stock's returns against your selected market. In other words, RLX Technology's beta of -0.66 provides an investor with an approximation of how much risk RLX Technology stock can potentially add to one of your existing portfolios. RLX Technology shows above-average downside volatility for the selected time horizon. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure RLX Technology's stock risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact RLX Technology's stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different financial instruments as prices fall.
3 Months Beta |Analyze RLX Technology Demand TrendCheck current 90 days RLX Technology correlation with market (Dow Jones Industrial)RLX Beta |
RLX standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. A typical volatile entity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.
Standard Deviation | 3.38 |
It is essential to understand the difference between upside risk (as represented by RLX Technology's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of RLX Technology's daily returns or price. Since the actual investment returns on holding a position in rlx stock tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in RLX Technology.
RLX Technology Stock Volatility Analysis
Volatility refers to the frequency at which RLX Technology stock price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with RLX Technology's price changes. Investors will then calculate the volatility of RLX Technology's stock to predict their future moves. A stock that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A stock with relatively stable price changes has low volatility. A highly volatile stock is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of RLX Technology's volatility:
Historical Volatility
This type of stock volatility measures RLX Technology's fluctuations based on previous trends. It's commonly used to predict RLX Technology's future behavior based on its past. However, it cannot conclusively determine the future direction of the stock.Implied Volatility
This type of volatility provides a positive outlook on future price fluctuations for RLX Technology's current market price. This means that the stock will return to its initially predicted market price. This type of volatility can be derived from derivative instruments written on RLX Technology's to be redeemed at a future date.Transformation |
The output start index for this execution was zero with a total number of output elements of sixty-one. RLX Technology Average Price is the average of the sum of open, high, low and close daily prices of a bar. It can be used to smooth an indicator that normally takes just the closing price as input.
RLX Technology Projected Return Density Against Market
Considering the 90-day investment horizon RLX Technology has a beta of -0.6613 indicating as returns on the benchmark increase, returns on holding RLX Technology are expected to decrease at a much lower rate. During a bear market, however, RLX Technology is likely to outperform the market.Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to RLX Technology or Food Products sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that RLX Technology's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a RLX stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
RLX Technology has an alpha of 0.0485, implying that it can generate a 0.0485 percent excess return over Dow Jones Industrial after adjusting for the inherited market risk (beta). Predicted Return Density |
| Returns |
What Drives a RLX Technology Price Volatility?
Several factors can influence a stock's market volatility:Industry
Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.Political and Economic environment
When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.The Company's Performance
Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.RLX Technology Stock Risk Measures
Considering the 90-day investment horizon the coefficient of variation of RLX Technology is 3127.99. The daily returns are distributed with a variance of 11.43 and standard deviation of 3.38. The mean deviation of RLX Technology is currently at 2.37. For similar time horizon, the selected benchmark (Dow Jones Industrial) has volatility of 0.89
α | Alpha over Dow Jones | 0.05 | |
β | Beta against Dow Jones | -0.66 | |
σ | Overall volatility | 3.38 | |
Ir | Information ratio | 0.05 |
RLX Technology Stock Return Volatility
RLX Technology historical daily return volatility represents how much of RLX Technology stock's daily returns swing around its mean - it is a statistical measure of its dispersion of returns. The company has volatility of 3.3801% on return distribution over 90 days investment horizon. By contrast, Dow Jones Industrial accepts 0.8449% volatility on return distribution over the 90 days horizon. Performance |
| Timeline |
About RLX Technology Volatility
Volatility is a rate at which the price of RLX Technology or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of RLX Technology may increase or decrease. In other words, similar to RLX's beta indicator, it measures the risk of RLX Technology and helps estimate the fluctuations that may happen in a short period of time. So if prices of RLX Technology fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.RLX Technology Inc., together with its subsidiaries, researchers, develops, manufactures, distributes, and sells e-vapor products in the Peoples Republic of China. RLX Technology Inc. was founded in 2018 and is based in Beijing, China. RLX Technology operates under Tobacco classification in the United States and is traded on New York Stock Exchange. It employs 1235 people.
RLX Technology's stock volatility refers to the amount of uncertainty or risk involved with the size of changes in its stock's price. It is a statistical measure of the dispersion of returns on RLX Stock over a specified period of time, often expressed as the standard deviation of daily returns. In other words, it measures how much RLX Technology's price varies over time.
3 ways to utilize RLX Technology's volatility to invest better
Higher RLX Technology's stock volatility means that the price of its stock is changing rapidly and unpredictably, while lower stock volatility indicates that the price of RLX Technology stock is relatively stable. Investors and traders use stock volatility as an indicator of risk and potential reward, as stocks with higher volatility can offer the potential for more significant returns but also come with a greater risk of losses. RLX Technology stock volatility can provide helpful information for making investment decisions in the following ways:- Measuring Risk: Volatility can be used as a measure of risk, which can help you determine the potential fluctuations in the value of RLX Technology investment. A higher volatility means higher risk and potentially larger changes in value.
- Identifying Opportunities: High volatility in RLX Technology's stock can indicate that there is potential for significant price movements, either up or down, which could present investment opportunities.
- Diversification: Understanding how the volatility of RLX Technology's stock relates to your other investments can help you create a well-diversified portfolio of assets with varying levels of risk.
RLX Technology Investment Opportunity
RLX Technology has a volatility of 3.38 and is 4.02 times more volatile than Dow Jones Industrial. 30 percent of all equities and portfolios are less risky than RLX Technology. You can use RLX Technology to protect your portfolios against small market fluctuations. The stock experiences a moderate downward daily trend and can be a good diversifier. Check odds of RLX Technology to be traded at $1.96 in 90 days.Good diversification
The correlation between RLX Technology and DJI is -0.17 (i.e., Good diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding RLX Technology and DJI in the same portfolio, assuming nothing else is changed.
RLX Technology Additional Risk Indicators
The analysis of RLX Technology's secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in RLX Technology's investment and either accepting that risk or mitigating it. Along with some common measures of RLX Technology stock's risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
| Risk Adjusted Performance | 0.0357 | |||
| Market Risk Adjusted Performance | (0.14) | |||
| Mean Deviation | 2.37 | |||
| Semi Deviation | 3.6 | |||
| Downside Deviation | 4.29 | |||
| Coefficient Of Variation | 3127.99 | |||
| Standard Deviation | 3.38 |
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential stocks, we recommend comparing similar stocks with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.
RLX Technology Suggested Diversification Pairs
Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against RLX Technology as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. RLX Technology's systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, RLX Technology's unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to RLX Technology.
Additional Tools for RLX Stock Analysis
When running RLX Technology's price analysis, check to measure RLX Technology's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy RLX Technology is operating at the current time. Most of RLX Technology's value examination focuses on studying past and present price action to predict the probability of RLX Technology's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move RLX Technology's price. Additionally, you may evaluate how the addition of RLX Technology to your portfolios can decrease your overall portfolio volatility.