Correlation Between Macys and Origin Agritech
Can any of the company-specific risk be diversified away by investing in both Macys 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 Macys and Origin Agritech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Macys Inc and Origin Agritech, you can compare the effects of market volatilities on Macys 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 Macys with a short position of Origin Agritech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Macys and Origin Agritech.
Diversification Opportunities for Macys and Origin Agritech
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Macys and Origin is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Macys Inc and Origin Agritech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Origin Agritech and Macys 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 Macys Inc 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 Macys i.e., Macys and Origin Agritech go up and down completely randomly.
Pair Corralation between Macys and Origin Agritech
Assuming the 90 days horizon Macys Inc is expected to generate 0.51 times more return on investment than Origin Agritech. However, Macys Inc is 1.96 times less risky than Origin Agritech. It trades about 0.0 of its potential returns per unit of risk. Origin Agritech is currently generating about -0.01 per unit of risk. If you would invest 1,928 in Macys Inc on September 3, 2024 and sell it today you would lose (418.00) from holding Macys Inc or give up 21.68% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Macys Inc vs. Origin Agritech
Performance |
| Timeline |
| Macys Inc |
| Origin Agritech |
Macys and Origin Agritech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Macys and Origin Agritech
The main advantage of trading using opposite Macys and Origin Agritech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Macys 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.| Macys vs. SCANSOURCE | Macys vs. HEALTHCARE REAL A | Macys vs. SHIP HEALTHCARE HLDGINC | Macys vs. EPSILON HEALTHCARE LTD |
| Origin Agritech vs. Gamma Communications plc | Origin Agritech vs. Chunghwa Telecom Co | Origin Agritech vs. Citic Telecom International | Origin Agritech vs. Ribbon Communications |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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