Correlation Between Origin Agritech and Safety Insurance
Can any of the company-specific risk be diversified away by investing in both Origin Agritech and Safety Insurance 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 Safety Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Origin Agritech and Safety Insurance Group, you can compare the effects of market volatilities on Origin Agritech and Safety Insurance 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 Safety Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Origin Agritech and Safety Insurance.
Diversification Opportunities for Origin Agritech and Safety Insurance
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Origin and Safety is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Origin Agritech and Safety Insurance Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Safety Insurance 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 Safety Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Safety Insurance has no effect on the direction of Origin Agritech i.e., Origin Agritech and Safety Insurance go up and down completely randomly.
Pair Corralation between Origin Agritech and Safety Insurance
Assuming the 90 days trading horizon Origin Agritech is expected to under-perform the Safety Insurance. In addition to that, Origin Agritech is 2.17 times more volatile than Safety Insurance Group. It trades about -0.04 of its total potential returns per unit of risk. Safety Insurance Group is currently generating about 0.27 per unit of volatility. If you would invest 7,250 in Safety Insurance Group on August 29, 2024 and sell it today you would earn a total of 800.00 from holding Safety Insurance Group or generate 11.03% 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. Safety Insurance Group
Performance |
| Timeline |
| Origin Agritech |
| Safety Insurance |
Origin Agritech and Safety Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Origin Agritech and Safety Insurance
The main advantage of trading using opposite Origin Agritech and Safety Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Origin Agritech position performs unexpectedly, Safety Insurance 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 Safety Insurance will offset losses from the drop in Safety Insurance'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 |
| Safety Insurance vs. PICC Property and | Safety Insurance vs. QBE Insurance Group | Safety Insurance vs. Superior Plus Corp | Safety Insurance 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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