Correlation Between NYSE Composite and JinkoSolar Holding
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and JinkoSolar Holding 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 NYSE Composite and JinkoSolar Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and JinkoSolar Holding, you can compare the effects of market volatilities on NYSE Composite and JinkoSolar Holding 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 NYSE Composite with a short position of JinkoSolar Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and JinkoSolar Holding.
Diversification Opportunities for NYSE Composite and JinkoSolar Holding
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between NYSE and JinkoSolar is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and JinkoSolar Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JinkoSolar Holding and NYSE Composite 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 NYSE Composite are associated (or correlated) with JinkoSolar Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JinkoSolar Holding has no effect on the direction of NYSE Composite i.e., NYSE Composite and JinkoSolar Holding go up and down completely randomly.
Pair Corralation between NYSE Composite and JinkoSolar Holding
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.45 times more return on investment than JinkoSolar Holding. However, NYSE Composite is 2.21 times less risky than JinkoSolar Holding. It trades about -0.11 of its potential returns per unit of risk. JinkoSolar Holding is currently generating about -0.32 per unit of risk. If you would invest 1,958,132 in NYSE Composite on January 18, 2025 and sell it today you would lose (121,420) from holding NYSE Composite or give up 6.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. JinkoSolar Holding
Performance |
| Timeline |
NYSE Composite and JinkoSolar Holding Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
JinkoSolar Holding
Pair trading matchups for JinkoSolar Holding
Pair Trading with NYSE Composite and JinkoSolar Holding
The main advantage of trading using opposite NYSE Composite and JinkoSolar Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, JinkoSolar Holding 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 JinkoSolar Holding will offset losses from the drop in JinkoSolar Holding's long position.| NYSE Composite vs. Oasis Hotel Resort | NYSE Composite vs. Avarone Metals | NYSE Composite vs. RLJ Lodging Trust | NYSE Composite vs. flyExclusive, |
| JinkoSolar Holding vs. First Solar | JinkoSolar Holding vs. SolarEdge Technologies | JinkoSolar Holding vs. Sunrun Inc | JinkoSolar Holding vs. Sunnova Energy International |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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