Correlation Between Aris Water and Jayud Global
Can any of the company-specific risk be diversified away by investing in both Aris Water and Jayud Global 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 Aris Water and Jayud Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aris Water Solutions and Jayud Global Logistics, you can compare the effects of market volatilities on Aris Water and Jayud Global 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 Aris Water with a short position of Jayud Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aris Water and Jayud Global.
Diversification Opportunities for Aris Water and Jayud Global
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Aris and Jayud is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Aris Water Solutions and Jayud Global Logistics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jayud Global Logistics and Aris Water 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 Aris Water Solutions are associated (or correlated) with Jayud Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jayud Global Logistics has no effect on the direction of Aris Water i.e., Aris Water and Jayud Global go up and down completely randomly.
Pair Corralation between Aris Water and Jayud Global
Given the investment horizon of 90 days Aris Water is expected to generate 2.59 times less return on investment than Jayud Global. But when comparing it to its historical volatility, Aris Water Solutions is 3.06 times less risky than Jayud Global. It trades about 0.2 of its potential returns per unit of risk. Jayud Global Logistics is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 75.00 in Jayud Global Logistics on September 12, 2024 and sell it today you would earn a total of 118.00 from holding Jayud Global Logistics or generate 157.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aris Water Solutions vs. Jayud Global Logistics
Performance |
| Timeline |
| Aris Water Solutions |
| Jayud Global Logistics |
Aris Water and Jayud Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aris Water and Jayud Global
The main advantage of trading using opposite Aris Water and Jayud Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aris Water position performs unexpectedly, Jayud Global 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 Jayud Global will offset losses from the drop in Jayud Global's long position.| Aris Water vs. Middlesex Water | Aris Water vs. California Water Service | Aris Water vs. Global Water Resources | Aris Water vs. American States Water |
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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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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