Correlation Between Origin Agritech and Engie SA
Can any of the company-specific risk be diversified away by investing in both Origin Agritech and Engie SA 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 Engie SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Origin Agritech and Engie SA, you can compare the effects of market volatilities on Origin Agritech and Engie SA 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 Engie SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Origin Agritech and Engie SA.
Diversification Opportunities for Origin Agritech and Engie SA
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Origin and Engie is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Origin Agritech and Engie SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Engie SA 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 Engie SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Engie SA has no effect on the direction of Origin Agritech i.e., Origin Agritech and Engie SA go up and down completely randomly.
Pair Corralation between Origin Agritech and Engie SA
Assuming the 90 days trading horizon Origin Agritech is expected to under-perform the Engie SA. In addition to that, Origin Agritech is 4.69 times more volatile than Engie SA. It trades about -0.1 of its total potential returns per unit of risk. Engie SA is currently generating about -0.05 per unit of volatility. If you would invest 1,551 in Engie SA on August 29, 2024 and sell it today you would lose (34.00) from holding Engie SA or give up 2.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 97.67% |
| Values | Daily Returns |
Origin Agritech vs. Engie SA
Performance |
| Timeline |
| Origin Agritech |
| Engie SA |
Origin Agritech and Engie SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Origin Agritech and Engie SA
The main advantage of trading using opposite Origin Agritech and Engie SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Origin Agritech position performs unexpectedly, Engie SA 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 Engie SA will offset losses from the drop in Engie SA'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 |
| Engie SA vs. Consolidated Communications Holdings | Engie SA vs. Mobilezone Holding AG | Engie SA vs. WillScot Mobile Mini | Engie SA vs. Shenandoah Telecommunications |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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