Correlation Between Origin Agritech and REGIONS FINANCIAL
Can any of the company-specific risk be diversified away by investing in both Origin Agritech and REGIONS FINANCIAL 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 REGIONS FINANCIAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Origin Agritech and REGIONS FINANCIAL PFD, you can compare the effects of market volatilities on Origin Agritech and REGIONS FINANCIAL 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 REGIONS FINANCIAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Origin Agritech and REGIONS FINANCIAL.
Diversification Opportunities for Origin Agritech and REGIONS FINANCIAL
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Origin and REGIONS is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Origin Agritech and REGIONS FINANCIAL PFD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on REGIONS FINANCIAL PFD 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 REGIONS FINANCIAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of REGIONS FINANCIAL PFD has no effect on the direction of Origin Agritech i.e., Origin Agritech and REGIONS FINANCIAL go up and down completely randomly.
Pair Corralation between Origin Agritech and REGIONS FINANCIAL
Assuming the 90 days trading horizon Origin Agritech is expected to under-perform the REGIONS FINANCIAL. In addition to that, Origin Agritech is 4.93 times more volatile than REGIONS FINANCIAL PFD. It trades about -0.07 of its total potential returns per unit of risk. REGIONS FINANCIAL PFD is currently generating about 0.11 per unit of volatility. If you would invest 1,568 in REGIONS FINANCIAL PFD on September 5, 2024 and sell it today you would earn a total of 252.00 from holding REGIONS FINANCIAL PFD or generate 16.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Origin Agritech vs. REGIONS FINANCIAL PFD
Performance |
| Timeline |
| Origin Agritech |
| REGIONS FINANCIAL PFD |
Origin Agritech and REGIONS FINANCIAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Origin Agritech and REGIONS FINANCIAL
The main advantage of trading using opposite Origin Agritech and REGIONS FINANCIAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Origin Agritech position performs unexpectedly, REGIONS FINANCIAL 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 REGIONS FINANCIAL will offset losses from the drop in REGIONS FINANCIAL's long position.| Origin Agritech vs. NISSIN FOODS HLDGS | Origin Agritech vs. Ebro Foods SA | Origin Agritech vs. Tyson Foods | Origin Agritech vs. CAL MAINE FOODS |
| REGIONS FINANCIAL vs. TERADATA | REGIONS FINANCIAL vs. Flutter Entertainment PLC | REGIONS FINANCIAL vs. REMEDY ENTERTAINMENT OYJ | REGIONS FINANCIAL vs. Seven West Media |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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