Correlation Between Kanzhun and Hirequest

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

By analyzing existing cross correlation between Kanzhun Ltd ADR and Hirequest, you can compare the effects of market volatilities on Kanzhun and Hirequest 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 Kanzhun with a short position of Hirequest. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kanzhun and Hirequest.

Diversification Opportunities for Kanzhun and Hirequest

-0.24

Correlation Coefficient

Kanzhun  Hirequest

Very good diversification

The 3 months correlation between Kanzhun and Hirequest is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Kanzhun Ltd ADR and Hirequest in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hirequest and Kanzhun 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 Kanzhun Ltd ADR are associated (or correlated) with Hirequest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hirequest has no effect on the direction of Kanzhun i.e., Kanzhun and Hirequest go up and down completely randomly.

Pair Corralation between Kanzhun and Hirequest

Allowing for the 90-day total investment horizon Kanzhun Ltd ADR is expected to generate 0.97 times more return on investment than Hirequest. However, Kanzhun Ltd ADR is 1.03 times less risky than Hirequest. It trades about 0.06 of its potential returns per unit of risk. Hirequest is currently generating about -0.05 per unit of risk. If you would invest  1,445  in Kanzhun Ltd ADR on February 26, 2024 and sell it today you would earn a total of  676.00  from holding Kanzhun Ltd ADR or generate 46.78% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	99.6%
Values	Daily Returns

Kanzhun Ltd ADR  vs.  Hirequest

Kanzhun Ltd ADR

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Kanzhun Ltd ADR are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating basic indicators, Kanzhun showed solid returns over the last few months and may actually be approaching a breakup point.

Hirequest

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hirequest has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Hirequest is not utilizing all of its potentials. The newest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Kanzhun and Hirequest

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

The idea behind Kanzhun Ltd ADR and Hirequest 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.

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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.