Correlation Between JIAHUA STORES and Cadence Design
Can any of the company-specific risk be diversified away by investing in both JIAHUA STORES and Cadence Design 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 JIAHUA STORES and Cadence Design into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JIAHUA STORES and Cadence Design Systems, you can compare the effects of market volatilities on JIAHUA STORES and Cadence Design 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 JIAHUA STORES with a short position of Cadence Design. Check out your portfolio center. Please also check ongoing floating volatility patterns of JIAHUA STORES and Cadence Design.
Diversification Opportunities for JIAHUA STORES and Cadence Design
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between JIAHUA and Cadence is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding JIAHUA STORES and Cadence Design Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cadence Design Systems and JIAHUA STORES 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 JIAHUA STORES are associated (or correlated) with Cadence Design. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cadence Design Systems has no effect on the direction of JIAHUA STORES i.e., JIAHUA STORES and Cadence Design go up and down completely randomly.
Pair Corralation between JIAHUA STORES and Cadence Design
If you would invest 1.90 in JIAHUA STORES on December 8, 2024 and sell it today you would earn a total of 0.00 from holding JIAHUA STORES or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
JIAHUA STORES vs. Cadence Design Systems
Performance |
| Timeline |
| JIAHUA STORES |
| Cadence Design Systems |
JIAHUA STORES and Cadence Design Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JIAHUA STORES and Cadence Design
The main advantage of trading using opposite JIAHUA STORES and Cadence Design positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JIAHUA STORES position performs unexpectedly, Cadence Design 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 Cadence Design will offset losses from the drop in Cadence Design's long position.| JIAHUA STORES vs. THORNEY TECHS LTD | ||
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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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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