Correlation Between Origin Agritech and Healthequity
Can any of the company-specific risk be diversified away by investing in both Origin Agritech and Healthequity 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 Origin Agritech and Healthequity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Origin Agritech and Healthequity, you can compare the effects of market volatilities on Origin Agritech and Healthequity 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 Origin Agritech with a short position of Healthequity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Origin Agritech and Healthequity.
Diversification Opportunities for Origin Agritech and Healthequity
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Origin and Healthequity is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Origin Agritech and Healthequity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Healthequity and Origin Agritech 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 Origin Agritech are associated (or correlated) with Healthequity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Healthequity has no effect on the direction of Origin Agritech i.e., Origin Agritech and Healthequity go up and down completely randomly.
Pair Corralation between Origin Agritech and Healthequity
Assuming the 90 days trading horizon Origin Agritech is expected to under-perform the Healthequity. In addition to that, Origin Agritech is 1.16 times more volatile than Healthequity. It trades about -0.04 of its total potential returns per unit of risk. Healthequity is currently generating about 0.27 per unit of volatility. If you would invest 8,150 in Healthequity on August 29, 2024 and sell it today you would earn a total of 1,700 from holding Healthequity or generate 20.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Origin Agritech vs. Healthequity
Performance |
| Timeline |
| Origin Agritech |
| Healthequity |
Origin Agritech and Healthequity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Origin Agritech and Healthequity
The main advantage of trading using opposite Origin Agritech and Healthequity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Origin Agritech position performs unexpectedly, Healthequity 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 Healthequity will offset losses from the drop in Healthequity's long position.| Origin Agritech vs. Playtech plc | Origin Agritech vs. AAC TECHNOLOGHLDGADR | Origin Agritech vs. SCANDMEDICAL SOLDK 040 | Origin Agritech vs. ONWARD MEDICAL BV |
| Healthequity vs. ARDAGH METAL PACDL 0001 | Healthequity vs. QINGCI GAMES INC | Healthequity vs. PENN NATL GAMING | Healthequity vs. Japan Tobacco |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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