Correlation Between Jadeart and LiveChain
Can any of the company-specific risk be diversified away by investing in both Jadeart and LiveChain 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 Jadeart and LiveChain into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jadeart Group and LiveChain, you can compare the effects of market volatilities on Jadeart and LiveChain 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 Jadeart with a short position of LiveChain. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jadeart and LiveChain.
Diversification Opportunities for Jadeart and LiveChain
Very good diversification
The 3 months correlation between Jadeart and LiveChain is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Jadeart Group and LiveChain in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LiveChain and Jadeart 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 Jadeart Group are associated (or correlated) with LiveChain. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LiveChain has no effect on the direction of Jadeart i.e., Jadeart and LiveChain go up and down completely randomly.
Pair Corralation between Jadeart and LiveChain
Given the investment horizon of 90 days Jadeart Group is expected to generate 8.74 times more return on investment than LiveChain. However, Jadeart is 8.74 times more volatile than LiveChain. It trades about 0.16 of its potential returns per unit of risk. LiveChain is currently generating about 0.22 per unit of risk. If you would invest 0.21 in Jadeart Group on October 26, 2024 and sell it today you would earn a total of 0.04 from holding Jadeart Group or generate 19.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Jadeart Group vs. LiveChain
Performance |
| Timeline |
| Jadeart Group |
| LiveChain |
Jadeart and LiveChain Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jadeart and LiveChain
The main advantage of trading using opposite Jadeart and LiveChain positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jadeart position performs unexpectedly, LiveChain 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 LiveChain will offset losses from the drop in LiveChain's long position.| Jadeart vs. China Sun Grp | Jadeart vs. Lotus Pharmaceuticals | Jadeart vs. China Medicine | Jadeart vs. China Clean Energy |
| LiveChain vs. American Leisure Holdings | LiveChain vs. Absolute Health and | LiveChain vs. Supurva Healthcare Group | LiveChain vs. China Health Management |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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