Correlation Between YiDong Electronics and Zepp Health

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Can any of the company-specific risk be diversified away by investing in both YiDong Electronics and Zepp Health 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 YiDong Electronics and Zepp Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between YiDong Electronics Technology and Zepp Health Corp, you can compare the effects of market volatilities on YiDong Electronics and Zepp Health 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 YiDong Electronics with a short position of Zepp Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of YiDong Electronics and Zepp Health.

Diversification Opportunities for YiDong Electronics and Zepp Health

0.52
  Correlation Coefficient

Very weak diversification

The 3 months correlation between YiDong and Zepp is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding YiDong Electronics Technology and Zepp Health Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zepp Health Corp and YiDong Electronics 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 YiDong Electronics Technology are associated (or correlated) with Zepp Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zepp Health Corp has no effect on the direction of YiDong Electronics i.e., YiDong Electronics and Zepp Health go up and down completely randomly.

Pair Corralation between YiDong Electronics and Zepp Health

Assuming the 90 days trading horizon YiDong Electronics Technology is expected to generate 0.64 times more return on investment than Zepp Health. However, YiDong Electronics Technology is 1.55 times less risky than Zepp Health. It trades about -0.02 of its potential returns per unit of risk. Zepp Health Corp is currently generating about -0.1 per unit of risk. If you would invest  4,610  in YiDong Electronics Technology on August 31, 2025 and sell it today you would lose (460.00) from holding YiDong Electronics Technology or give up 9.98% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy93.65%
ValuesDaily Returns

YiDong Electronics Technology  vs.  Zepp Health Corp

 Performance 
       Timeline  
YiDong Electronics 

Risk-Adjusted Performance

Weakest

 
Weak
 
Strong
Over the last 90 days YiDong Electronics Technology has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, YiDong Electronics is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
Zepp Health Corp 

Risk-Adjusted Performance

Weakest

 
Weak
 
Strong
Over the last 90 days Zepp Health Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Even with unfluctuating performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in December 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

YiDong Electronics and Zepp Health Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with YiDong Electronics and Zepp Health

The main advantage of trading using opposite YiDong Electronics and Zepp Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if YiDong Electronics position performs unexpectedly, Zepp Health 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 Zepp Health will offset losses from the drop in Zepp Health's long position.
The idea behind YiDong Electronics Technology and Zepp Health Corp 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.

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