Correlation Between Cabelas and YY

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Can any of the company-specific risk be diversified away by investing in both Cabelas and YY 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 Cabelas and YY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cabelas and YY Inc Class, you can compare the effects of market volatilities on Cabelas and YY 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 Cabelas with a short position of YY. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cabelas and YY.

Diversification Opportunities for Cabelas and YY

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  Correlation Coefficient

Pay attention - limited upside

The 12 months correlation between Cabelas and YY is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Cabelas and YY Inc Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YY Inc Class and Cabelas 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 Cabelas are associated (or correlated) with YY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YY Inc Class has no effect on the direction of Cabelas i.e., Cabelas and YY go up and down completely randomly.

Pair Corralation between Cabelas and YY

If you would invest  3,042  in YY Inc Class on December 29, 2023 and sell it today you would lose (17.00) from holding YY Inc Class or give up 0.56% of portfolio value over 90 days.
Time Period12 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.0%
ValuesDaily Returns

Cabelas  vs.  YY Inc Class

 Performance 
       Timeline  
Cabelas 

Risk-Adjusted Performance

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Over the last 90 days Cabelas has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Cabelas is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.
YY Inc Class 

Risk-Adjusted Performance

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Low
 
High
Very Weak
Over the last 90 days YY Inc Class has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, YY is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Cabelas and YY Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Cabelas and YY

The main advantage of trading using opposite Cabelas and YY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cabelas position performs unexpectedly, YY 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 YY will offset losses from the drop in YY's long position.
The idea behind Cabelas and YY Inc Class 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.

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