Correlation Between INTER CARS and Origin Agritech
Can any of the company-specific risk be diversified away by investing in both INTER CARS and Origin Agritech 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 INTER CARS and Origin Agritech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between INTER CARS SA and Origin Agritech, you can compare the effects of market volatilities on INTER CARS and Origin Agritech 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 INTER CARS with a short position of Origin Agritech. Check out your portfolio center. Please also check ongoing floating volatility patterns of INTER CARS and Origin Agritech.
Diversification Opportunities for INTER CARS and Origin Agritech
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between INTER and Origin is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding INTER CARS SA and Origin Agritech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Origin Agritech and INTER CARS 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 INTER CARS SA are associated (or correlated) with Origin Agritech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Origin Agritech has no effect on the direction of INTER CARS i.e., INTER CARS and Origin Agritech go up and down completely randomly.
Pair Corralation between INTER CARS and Origin Agritech
Assuming the 90 days horizon INTER CARS SA is expected to generate 0.38 times more return on investment than Origin Agritech. However, INTER CARS SA is 2.61 times less risky than Origin Agritech. It trades about -0.15 of its potential returns per unit of risk. Origin Agritech is currently generating about -0.26 per unit of risk. If you would invest 11,540 in INTER CARS SA on August 24, 2024 and sell it today you would lose (640.00) from holding INTER CARS SA or give up 5.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
INTER CARS SA vs. Origin Agritech
Performance |
| Timeline |
| INTER CARS SA |
| Origin Agritech |
INTER CARS and Origin Agritech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with INTER CARS and Origin Agritech
The main advantage of trading using opposite INTER CARS and Origin Agritech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INTER CARS position performs unexpectedly, Origin Agritech 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 Origin Agritech will offset losses from the drop in Origin Agritech's long position.| INTER CARS vs. Origin Agritech | INTER CARS vs. SIVERS SEMICONDUCTORS AB | INTER CARS vs. Talanx AG | INTER CARS vs. INTUITIVE SURGICAL |
| Origin Agritech vs. COPLAND ROAD CAPITAL | Origin Agritech vs. SHIP HEALTHCARE HLDGINC | Origin Agritech vs. YOOMA WELLNESS INC | Origin Agritech vs. TRAINLINE PLC LS |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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