Correlation Between Origin Agritech and Progressive
Can any of the company-specific risk be diversified away by investing in both Origin Agritech and Progressive 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 Progressive into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Origin Agritech and The Progressive, you can compare the effects of market volatilities on Origin Agritech and Progressive 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 Progressive. Check out your portfolio center. Please also check ongoing floating volatility patterns of Origin Agritech and Progressive.
Diversification Opportunities for Origin Agritech and Progressive
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Origin and Progressive is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Origin Agritech and The Progressive in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Progressive 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 Progressive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Progressive has no effect on the direction of Origin Agritech i.e., Origin Agritech and Progressive go up and down completely randomly.
Pair Corralation between Origin Agritech and Progressive
Assuming the 90 days trading horizon Origin Agritech is expected to generate 14.03 times less return on investment than Progressive. In addition to that, Origin Agritech is 3.67 times more volatile than The Progressive. It trades about 0.0 of its total potential returns per unit of risk. The Progressive is currently generating about 0.12 per unit of volatility. If you would invest 12,037 in The Progressive on September 1, 2024 and sell it today you would earn a total of 13,718 from holding The Progressive or generate 113.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Origin Agritech vs. The Progressive
Performance |
| Timeline |
| Origin Agritech |
| Progressive |
Origin Agritech and Progressive Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Origin Agritech and Progressive
The main advantage of trading using opposite Origin Agritech and Progressive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Origin Agritech position performs unexpectedly, Progressive 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 Progressive will offset losses from the drop in Progressive's long position.| Origin Agritech vs. CARSALESCOM | Origin Agritech vs. Uber Technologies | Origin Agritech vs. GEELY AUTOMOBILE | Origin Agritech vs. Playtech plc |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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