Correlation Between Agora and Youxin Technology

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

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

Diversification Opportunities for Agora and Youxin Technology

0.63

Correlation Coefficient

Agora  Youxin Technology

Poor diversification

The 3 months correlation between Agora and Youxin is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Agora Inc and Youxin Technology Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Youxin Technology and Agora 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 Agora Inc are associated (or correlated) with Youxin Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Youxin Technology has no effect on the direction of Agora i.e., Agora and Youxin Technology go up and down completely randomly.

Pair Corralation between Agora and Youxin Technology

Considering the 90-day investment horizon Agora Inc is expected to under-perform the Youxin Technology. But the stock apears to be less risky and, when comparing its historical volatility, Agora Inc is 1.62 times less risky than Youxin Technology. The stock trades about -0.15 of its potential returns per unit of risk. The Youxin Technology Ltd is currently generating about -0.09 of returns per unit of risk over similar time horizon. If you would invest  336.00  in Youxin Technology Ltd on February 11, 2025 and sell it today you would lose (165.00) from holding Youxin Technology Ltd or give up 49.11% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Agora Inc  vs.  Youxin Technology Ltd

Agora Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Agora Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in June 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Youxin Technology

Risk-Adjusted Performance

Very Weak

Over the last 90 days Youxin Technology Ltd has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in June 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Agora and Youxin Technology

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

The idea behind Agora Inc and Youxin Technology Ltd 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.