Correlation Between Distoken Acquisition and Jupai Holdings

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

Diversification Opportunities for Distoken Acquisition and Jupai Holdings

-0.48
  Correlation Coefficient

Very good diversification

The 3 months correlation between Distoken and Jupai is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Distoken Acquisition and Jupai Holdings Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jupai Holdings and Distoken Acquisition 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 Distoken Acquisition are associated (or correlated) with Jupai Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jupai Holdings has no effect on the direction of Distoken Acquisition i.e., Distoken Acquisition and Jupai Holdings go up and down completely randomly.

Pair Corralation between Distoken Acquisition and Jupai Holdings

If you would invest  1,091  in Distoken Acquisition on August 24, 2024 and sell it today you would earn a total of  27.00  from holding Distoken Acquisition or generate 2.47% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy4.55%
ValuesDaily Returns

Distoken Acquisition  vs.  Jupai Holdings Limited

 Performance 
       Timeline  
Distoken Acquisition 

Risk-Adjusted Performance

14 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Distoken Acquisition are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Distoken Acquisition is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.
Jupai Holdings 

Risk-Adjusted Performance

0 of 100

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

Distoken Acquisition and Jupai Holdings Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Distoken Acquisition and Jupai Holdings

The main advantage of trading using opposite Distoken Acquisition and Jupai Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Distoken Acquisition position performs unexpectedly, Jupai Holdings 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 Jupai Holdings will offset losses from the drop in Jupai Holdings' long position.
The idea behind Distoken Acquisition and Jupai Holdings Limited 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.
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.

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