Correlation Between Origin Agritech and CubeSmart
Can any of the company-specific risk be diversified away by investing in both Origin Agritech and CubeSmart 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 CubeSmart into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Origin Agritech and CubeSmart, you can compare the effects of market volatilities on Origin Agritech and CubeSmart 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 CubeSmart. Check out your portfolio center. Please also check ongoing floating volatility patterns of Origin Agritech and CubeSmart.
Diversification Opportunities for Origin Agritech and CubeSmart
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Origin and CubeSmart is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Origin Agritech and CubeSmart in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CubeSmart 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 CubeSmart. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CubeSmart has no effect on the direction of Origin Agritech i.e., Origin Agritech and CubeSmart go up and down completely randomly.
Pair Corralation between Origin Agritech and CubeSmart
Assuming the 90 days trading horizon Origin Agritech is expected to generate 1.49 times less return on investment than CubeSmart. In addition to that, Origin Agritech is 3.72 times more volatile than CubeSmart. It trades about 0.04 of its total potential returns per unit of risk. CubeSmart is currently generating about 0.21 per unit of volatility. If you would invest 4,362 in CubeSmart on September 1, 2024 and sell it today you would earn a total of 293.00 from holding CubeSmart or generate 6.72% 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. CubeSmart
Performance |
| Timeline |
| Origin Agritech |
| CubeSmart |
Origin Agritech and CubeSmart Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Origin Agritech and CubeSmart
The main advantage of trading using opposite Origin Agritech and CubeSmart positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Origin Agritech position performs unexpectedly, CubeSmart 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 CubeSmart will offset losses from the drop in CubeSmart's long position.| Origin Agritech vs. CARSALESCOM | Origin Agritech vs. Uber Technologies | Origin Agritech vs. GEELY AUTOMOBILE | Origin Agritech vs. Playtech plc |
| CubeSmart vs. Coor Service Management | CubeSmart vs. Consolidated Communications Holdings | CubeSmart vs. Cogent Communications Holdings | CubeSmart vs. SK TELECOM TDADR |
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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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