Correlation Between DouYu International and PropertyGuru

Can any of the company-specific risk be diversified away by investing in both DouYu International and PropertyGuru 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 PropertyGuru 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 PropertyGuru Group, you can compare the effects of market volatilities on DouYu International and PropertyGuru 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 PropertyGuru. Check out your portfolio center. Please also check ongoing floating volatility patterns of DouYu International and PropertyGuru.

Diversification Opportunities for DouYu International and PropertyGuru

-0.54

Correlation Coefficient

DouYu International  PropertyGuru

Excellent diversification

The 3 months correlation between DouYu and PropertyGuru is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding DouYu International Holdings and PropertyGuru Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PropertyGuru Group 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 PropertyGuru. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PropertyGuru Group has no effect on the direction of DouYu International i.e., DouYu International and PropertyGuru go up and down completely randomly.

Pair Corralation between DouYu International and PropertyGuru

Given the investment horizon of 90 days DouYu International Holdings is expected to generate 35.49 times more return on investment than PropertyGuru. However, DouYu International is 35.49 times more volatile than PropertyGuru Group. It trades about 0.1 of its potential returns per unit of risk. PropertyGuru Group is currently generating about 0.0 per unit of risk. If you would invest  898.00  in DouYu International Holdings on August 24, 2024 and sell it today you would earn a total of  74.00  from holding DouYu International Holdings or generate 8.24% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

DouYu International Holdings  vs.  PropertyGuru Group

DouYu International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days DouYu International Holdings 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 December 2024. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

PropertyGuru Group

Risk-Adjusted Performance

3 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in PropertyGuru Group are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, PropertyGuru is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with DouYu International and PropertyGuru

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

The idea behind DouYu International Holdings and PropertyGuru Group 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 Valuation module to check real value of public entities based on technical and fundamental data.