Correlation Between Origin Agritech and Seaboard
Can any of the company-specific risk be diversified away by investing in both Origin Agritech and Seaboard 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 Seaboard into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Origin Agritech and Seaboard, you can compare the effects of market volatilities on Origin Agritech and Seaboard 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 Seaboard. Check out your portfolio center. Please also check ongoing floating volatility patterns of Origin Agritech and Seaboard.
Diversification Opportunities for Origin Agritech and Seaboard
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Origin and Seaboard is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Origin Agritech and Seaboard in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seaboard 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 Seaboard. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seaboard has no effect on the direction of Origin Agritech i.e., Origin Agritech and Seaboard go up and down completely randomly.
Pair Corralation between Origin Agritech and Seaboard
Assuming the 90 days trading horizon Origin Agritech is expected to generate 3.4 times more return on investment than Seaboard. However, Origin Agritech is 3.4 times more volatile than Seaboard. It trades about 0.0 of its potential returns per unit of risk. Seaboard is currently generating about -0.2 per unit of risk. If you would invest 238.00 in Origin Agritech on August 25, 2024 and sell it today you would lose (10.00) from holding Origin Agritech or give up 4.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Origin Agritech vs. Seaboard
Performance |
| Timeline |
| Origin Agritech |
| Seaboard |
Origin Agritech and Seaboard Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Origin Agritech and Seaboard
The main advantage of trading using opposite Origin Agritech and Seaboard positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Origin Agritech position performs unexpectedly, Seaboard 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 Seaboard will offset losses from the drop in Seaboard's long position.| Origin Agritech vs. Mizuho Financial Group | Origin Agritech vs. Mitsui Chemicals | Origin Agritech vs. PT Bank Maybank | Origin Agritech vs. REVO INSURANCE SPA |
| Seaboard vs. Superior Plus Corp | Seaboard vs. NMI Holdings | Seaboard vs. Origin Agritech | Seaboard vs. SIVERS SEMICONDUCTORS AB |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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