Correlation Between Origin Agritech and Tesla
Can any of the company-specific risk be diversified away by investing in both Origin Agritech and Tesla 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 Tesla into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Origin Agritech and Tesla Inc, you can compare the effects of market volatilities on Origin Agritech and Tesla 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 Tesla. Check out your portfolio center. Please also check ongoing floating volatility patterns of Origin Agritech and Tesla.
Diversification Opportunities for Origin Agritech and Tesla
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Origin and Tesla is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Origin Agritech and Tesla Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tesla Inc 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 Tesla. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tesla Inc has no effect on the direction of Origin Agritech i.e., Origin Agritech and Tesla go up and down completely randomly.
Pair Corralation between Origin Agritech and Tesla
Assuming the 90 days trading horizon Origin Agritech is expected to generate 1.77 times more return on investment than Tesla. However, Origin Agritech is 1.77 times more volatile than Tesla Inc. It trades about 0.07 of its potential returns per unit of risk. Tesla Inc is currently generating about 0.09 per unit of risk. If you would invest 142.00 in Origin Agritech on August 28, 2024 and sell it today you would earn a total of 92.00 from holding Origin Agritech or generate 64.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.53% |
| Values | Daily Returns |
Origin Agritech vs. Tesla Inc
Performance |
| Timeline |
| Origin Agritech |
| Tesla Inc |
Origin Agritech and Tesla Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Origin Agritech and Tesla
The main advantage of trading using opposite Origin Agritech and Tesla positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Origin Agritech position performs unexpectedly, Tesla 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 Tesla will offset losses from the drop in Tesla's long position.| Origin Agritech vs. 24SEVENOFFICE GROUP AB | Origin Agritech vs. MAVEN WIRELESS SWEDEN | Origin Agritech vs. SIDETRADE EO 1 | Origin Agritech vs. HK Electric Investments |
| Tesla vs. Playa Hotels Resorts | Tesla vs. BioNTech SE | Tesla vs. PLAY2CHILL SA ZY | Tesla vs. INTERSHOP Communications Aktiengesellschaft |
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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