Correlation Between NetEase and Slate Office
Can any of the company-specific risk be diversified away by investing in both NetEase and Slate Office 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 NetEase and Slate Office into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NetEase and Slate Office REIT, you can compare the effects of market volatilities on NetEase and Slate Office 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 NetEase with a short position of Slate Office. Check out your portfolio center. Please also check ongoing floating volatility patterns of NetEase and Slate Office.
Diversification Opportunities for NetEase and Slate Office
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between NetEase and Slate is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding NetEase and Slate Office REIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Slate Office REIT and NetEase 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 NetEase are associated (or correlated) with Slate Office. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Slate Office REIT has no effect on the direction of NetEase i.e., NetEase and Slate Office go up and down completely randomly.
Pair Corralation between NetEase and Slate Office
Given the investment horizon of 90 days NetEase is expected to generate 4.45 times more return on investment than Slate Office. However, NetEase is 4.45 times more volatile than Slate Office REIT. It trades about 0.07 of its potential returns per unit of risk. Slate Office REIT is currently generating about 0.12 per unit of risk. If you would invest 13,677 in NetEase on July 20, 2025 and sell it today you would earn a total of 1,144 from holding NetEase or generate 8.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
NetEase vs. Slate Office REIT
Performance |
| Timeline |
| NetEase |
| Slate Office REIT |
NetEase and Slate Office Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NetEase and Slate Office
The main advantage of trading using opposite NetEase and Slate Office positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NetEase position performs unexpectedly, Slate Office 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 Slate Office will offset losses from the drop in Slate Office's long position.| NetEase vs. Roblox Corp | NetEase vs. MicroStrategy Incorporated | NetEase vs. Dell Technologies | NetEase vs. Cadence Design Systems |
| Slate Office vs. Inovalis Real Estate | Slate Office vs. American Hotel Income | Slate Office vs. Guangzhou RF Properties | Slate Office vs. Shanghai Industrial Urban |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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