Correlation Between Boswell J and China Green
Can any of the company-specific risk be diversified away by investing in both Boswell J and China Green 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 Boswell J and China Green into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boswell J G and China Green Agriculture, you can compare the effects of market volatilities on Boswell J and China Green 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 Boswell J with a short position of China Green. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boswell J and China Green.
Diversification Opportunities for Boswell J and China Green
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Boswell and China is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Boswell J G and China Green Agriculture in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Green Agriculture and Boswell J 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 Boswell J G are associated (or correlated) with China Green. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Green Agriculture has no effect on the direction of Boswell J i.e., Boswell J and China Green go up and down completely randomly.
Pair Corralation between Boswell J and China Green
Given the investment horizon of 90 days Boswell J G is expected to generate 0.26 times more return on investment than China Green. However, Boswell J G is 3.79 times less risky than China Green. It trades about 0.15 of its potential returns per unit of risk. China Green Agriculture is currently generating about 0.02 per unit of risk. If you would invest 55,700 in Boswell J G on August 30, 2024 and sell it today you would earn a total of 2,300 from holding Boswell J G or generate 4.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Boswell J G vs. China Green Agriculture
Performance |
| Timeline |
| Boswell J G |
| China Green Agriculture |
Boswell J and China Green Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boswell J and China Green
The main advantage of trading using opposite Boswell J and China Green positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boswell J position performs unexpectedly, China Green 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 China Green will offset losses from the drop in China Green's long position.| Boswell J vs. KS AG DRC | Boswell J vs. ICL Israel Chemicals | Boswell J vs. CF Industries Holdings | Boswell J vs. The Mosaic |
| China Green vs. KS AG DRC | China Green vs. Intrepid Potash | China Green vs. Bioceres Crop Solutions | China Green vs. American Vanguard |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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