Correlation Between Global E and PDD Holdings
Can any of the company-specific risk be diversified away by investing in both Global E and PDD 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 Global E and PDD Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global E Online and PDD Holdings, you can compare the effects of market volatilities on Global E and PDD 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 Global E with a short position of PDD Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global E and PDD Holdings.
Diversification Opportunities for Global E and PDD Holdings
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Global and PDD is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Global E Online and PDD Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PDD Holdings and Global E 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 Global E Online are associated (or correlated) with PDD Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PDD Holdings has no effect on the direction of Global E i.e., Global E and PDD Holdings go up and down completely randomly.
Pair Corralation between Global E and PDD Holdings
Given the investment horizon of 90 days Global E is expected to generate 3.36 times less return on investment than PDD Holdings. In addition to that, Global E is 1.53 times more volatile than PDD Holdings. It trades about 0.04 of its total potential returns per unit of risk. PDD Holdings is currently generating about 0.2 per unit of volatility. If you would invest 10,162 in PDD Holdings on June 8, 2025 and sell it today you would earn a total of 2,306 from holding PDD Holdings or generate 22.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global E Online vs. PDD Holdings
Performance |
| Timeline |
| Global E Online |
| PDD Holdings |
Global E and PDD Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global E and PDD Holdings
The main advantage of trading using opposite Global E and PDD Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global E position performs unexpectedly, PDD 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 PDD Holdings will offset losses from the drop in PDD Holdings' long position.| Global E vs. Sea | Global E vs. MercadoLibre | Global E vs. Jumia Technologies AG | Global E vs. PDD Holdings |
| PDD Holdings vs. JD Inc Adr | PDD Holdings vs. Alibaba Group Holding | PDD Holdings vs. Sea | PDD Holdings vs. Vipshop Holdings Limited |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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