Correlation Between IQIYI and Grayscale Zcash

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

By analyzing existing cross correlation between iQIYI Inc and Grayscale Zcash Trust, you can compare the effects of market volatilities on IQIYI and Grayscale Zcash 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 IQIYI with a short position of Grayscale Zcash. Check out your portfolio center. Please also check ongoing floating volatility patterns of IQIYI and Grayscale Zcash.

Diversification Opportunities for IQIYI and Grayscale Zcash

-0.43

Correlation Coefficient

IQIYI  Grayscale Zcash

Very good diversification

The 3 months correlation between IQIYI and Grayscale is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding iQIYI Inc and Grayscale Zcash Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grayscale Zcash Trust and IQIYI 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 iQIYI Inc are associated (or correlated) with Grayscale Zcash. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grayscale Zcash Trust has no effect on the direction of IQIYI i.e., IQIYI and Grayscale Zcash go up and down completely randomly.

Pair Corralation between IQIYI and Grayscale Zcash

Allowing for the 90-day total investment horizon iQIYI Inc is expected to under-perform the Grayscale Zcash. But the stock apears to be less risky and, when comparing its historical volatility, iQIYI Inc is 2.54 times less risky than Grayscale Zcash. The stock trades about -0.04 of its potential returns per unit of risk. The Grayscale Zcash Trust is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest  453.00  in Grayscale Zcash Trust on September 21, 2024 and sell it today you would earn a total of  164.00  from holding Grayscale Zcash Trust or generate 36.2% return on investment over 90 days.

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

iQIYI Inc  vs.  Grayscale Zcash Trust

iQIYI Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days iQIYI Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, IQIYI is not utilizing all of its potentials. The newest stock price agitation, may contribute to short-term losses for the retail investors.

Grayscale Zcash Trust

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Grayscale Zcash Trust are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite fairly fragile basic indicators, Grayscale Zcash demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with IQIYI and Grayscale Zcash

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

The idea behind iQIYI Inc and Grayscale Zcash Trust 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.