Correlation Between MayAir Technology and Jiugui Liquor

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Can any of the company-specific risk be diversified away by investing in both MayAir Technology and Jiugui Liquor 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 MayAir Technology and Jiugui Liquor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MayAir Technology Co and Jiugui Liquor Co, you can compare the effects of market volatilities on MayAir Technology and Jiugui Liquor 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 MayAir Technology with a short position of Jiugui Liquor. Check out your portfolio center. Please also check ongoing floating volatility patterns of MayAir Technology and Jiugui Liquor.

Diversification Opportunities for MayAir Technology and Jiugui Liquor

0.37
  Correlation Coefficient

Weak diversification

The 3 months correlation between MayAir and Jiugui is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding MayAir Technology Co and Jiugui Liquor Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiugui Liquor and MayAir Technology 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 MayAir Technology Co are associated (or correlated) with Jiugui Liquor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiugui Liquor has no effect on the direction of MayAir Technology i.e., MayAir Technology and Jiugui Liquor go up and down completely randomly.

Pair Corralation between MayAir Technology and Jiugui Liquor

Assuming the 90 days trading horizon MayAir Technology Co is expected to generate 1.14 times more return on investment than Jiugui Liquor. However, MayAir Technology is 1.14 times more volatile than Jiugui Liquor Co. It trades about 0.01 of its potential returns per unit of risk. Jiugui Liquor Co is currently generating about -0.08 per unit of risk. If you would invest  3,541  in MayAir Technology Co on October 16, 2024 and sell it today you would lose (327.00) from holding MayAir Technology Co or give up 9.23% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

MayAir Technology Co  vs.  Jiugui Liquor Co

 Performance 
       Timeline  
MayAir Technology 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days MayAir Technology Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.
Jiugui Liquor 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Jiugui Liquor Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Jiugui Liquor is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

MayAir Technology and Jiugui Liquor Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with MayAir Technology and Jiugui Liquor

The main advantage of trading using opposite MayAir Technology and Jiugui Liquor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MayAir Technology position performs unexpectedly, Jiugui Liquor 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 Jiugui Liquor will offset losses from the drop in Jiugui Liquor's long position.
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The idea behind MayAir Technology Co and Jiugui Liquor Co pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.

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