Correlation Between Scienjoy Holding and Spotify Technology

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

By analyzing existing cross correlation between Scienjoy Holding Corp and Spotify Technology SA, you can compare the effects of market volatilities on Scienjoy Holding and Spotify 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 Scienjoy Holding with a short position of Spotify Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Scienjoy Holding and Spotify Technology.

Diversification Opportunities for Scienjoy Holding and Spotify Technology

-0.59

Correlation Coefficient

Scienjoy Holding  Spotify Technology

Excellent diversification

The 3 months correlation between Scienjoy and Spotify is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Scienjoy Holding Corp and Spotify Technology SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Spotify Technology and Scienjoy Holding 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 Scienjoy Holding Corp are associated (or correlated) with Spotify Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Spotify Technology has no effect on the direction of Scienjoy Holding i.e., Scienjoy Holding and Spotify Technology go up and down completely randomly.

Pair Corralation between Scienjoy Holding and Spotify Technology

Allowing for the 90-day total investment horizon Scienjoy Holding is expected to generate 7.64 times less return on investment than Spotify Technology. In addition to that, Scienjoy Holding is 2.0 times more volatile than Spotify Technology SA. It trades about 0.0 of its total potential returns per unit of risk. Spotify Technology SA is currently generating about 0.02 per unit of volatility. If you would invest  61,398  in Spotify Technology SA on April 30, 2025 and sell it today you would earn a total of  603.00  from holding Spotify Technology SA or generate 0.98% return on investment over 90 days.

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

Scienjoy Holding Corp  vs.  Spotify Technology SA

Scienjoy Holding Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Scienjoy Holding Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively steady forward-looking indicators, Scienjoy Holding is not utilizing all of its potentials. The latest stock price chaos, may contribute to medium-term losses for the stakeholders.

Spotify Technology

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Spotify Technology SA are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Spotify Technology is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Scienjoy Holding and Spotify Technology

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

The idea behind Scienjoy Holding Corp and Spotify Technology SA 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.