Correlation Between DouYu International and Onfolio Holdings

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

By analyzing existing cross correlation between DouYu International Holdings and Onfolio Holdings, you can compare the effects of market volatilities on DouYu International and Onfolio Holdings 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 DouYu International with a short position of Onfolio Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of DouYu International and Onfolio Holdings.

Diversification Opportunities for DouYu International and Onfolio Holdings

0.82

Correlation Coefficient

DouYu International  Onfolio Holdings

Very poor diversification

The 3 months correlation between DouYu and Onfolio is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding DouYu International Holdings and Onfolio Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Onfolio Holdings and DouYu International 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 DouYu International Holdings are associated (or correlated) with Onfolio Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Onfolio Holdings has no effect on the direction of DouYu International i.e., DouYu International and Onfolio Holdings go up and down completely randomly.

Pair Corralation between DouYu International and Onfolio Holdings

Given the investment horizon of 90 days DouYu International Holdings is expected to generate 0.72 times more return on investment than Onfolio Holdings. However, DouYu International Holdings is 1.38 times less risky than Onfolio Holdings. It trades about 0.06 of its potential returns per unit of risk. Onfolio Holdings is currently generating about 0.03 per unit of risk. If you would invest  714.00  in DouYu International Holdings on May 7, 2025 and sell it today you would earn a total of  66.00  from holding DouYu International Holdings or generate 9.24% return on investment over 90 days.

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

DouYu International Holdings  vs.  Onfolio Holdings

DouYu International

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in DouYu International Holdings are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating basic indicators, DouYu International may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Onfolio Holdings

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Onfolio Holdings are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very weak technical and fundamental indicators, Onfolio Holdings may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with DouYu International and Onfolio Holdings

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

The idea behind DouYu International Holdings and Onfolio Holdings 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.

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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.