Correlation Between Xunlei and Workday
Can any of the company-specific risk be diversified away by investing in both Xunlei and Workday 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 Xunlei and Workday into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xunlei Ltd Adr and Workday, you can compare the effects of market volatilities on Xunlei and Workday 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 Xunlei with a short position of Workday. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xunlei and Workday.
Diversification Opportunities for Xunlei and Workday
Good diversification
The 3 months correlation between Xunlei and Workday is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Xunlei Ltd Adr and Workday in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Workday and Xunlei 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 Xunlei Ltd Adr are associated (or correlated) with Workday. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Workday has no effect on the direction of Xunlei i.e., Xunlei and Workday go up and down completely randomly.
Pair Corralation between Xunlei and Workday
Given the investment horizon of 90 days Xunlei Ltd Adr is expected to under-perform the Workday. In addition to that, Xunlei is 1.23 times more volatile than Workday. It trades about -0.09 of its total potential returns per unit of risk. Workday is currently generating about -0.06 per unit of volatility. If you would invest 27,290 in Workday on January 20, 2024 and sell it today you would lose (2,068) from holding Workday or give up 7.58% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Xunlei Ltd Adr vs. Workday
Performance |
Timeline |
Xunlei Ltd Adr |
Workday |
Xunlei and Workday Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Xunlei and Workday
The main advantage of trading using opposite Xunlei and Workday positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xunlei position performs unexpectedly, Workday 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 Workday will offset losses from the drop in Workday's long position.Xunlei vs. Interpublic Group of | Xunlei vs. Criteo Sa | Xunlei vs. WPP PLC ADR | Xunlei vs. Integral Ad Science |
Workday vs. Intuit Inc | Workday vs. Zoom Video Communications | Workday vs. ServiceNow | Workday vs. Snowflake |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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