Correlation Between PERENNIAL ENERGY and Origin Agritech
Can any of the company-specific risk be diversified away by investing in both PERENNIAL ENERGY 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 PERENNIAL ENERGY and Origin Agritech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PERENNIAL ENERGY HD 01 and Origin Agritech, you can compare the effects of market volatilities on PERENNIAL ENERGY 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 PERENNIAL ENERGY with a short position of Origin Agritech. Check out your portfolio center. Please also check ongoing floating volatility patterns of PERENNIAL ENERGY and Origin Agritech.
Diversification Opportunities for PERENNIAL ENERGY and Origin Agritech
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between PERENNIAL and Origin is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding PERENNIAL ENERGY HD 01 and Origin Agritech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Origin Agritech and PERENNIAL ENERGY 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 PERENNIAL ENERGY HD 01 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 PERENNIAL ENERGY i.e., PERENNIAL ENERGY and Origin Agritech go up and down completely randomly.
Pair Corralation between PERENNIAL ENERGY and Origin Agritech
Assuming the 90 days horizon PERENNIAL ENERGY HD 01 is expected to generate 0.77 times more return on investment than Origin Agritech. However, PERENNIAL ENERGY HD 01 is 1.29 times less risky than Origin Agritech. It trades about 0.03 of its potential returns per unit of risk. Origin Agritech is currently generating about 0.0 per unit of risk. If you would invest 11.00 in PERENNIAL ENERGY HD 01 on August 31, 2024 and sell it today you would earn a total of 1.00 from holding PERENNIAL ENERGY HD 01 or generate 9.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.74% |
| Values | Daily Returns |
PERENNIAL ENERGY HD 01 vs. Origin Agritech
Performance |
| Timeline |
| PERENNIAL ENERGY |
| Origin Agritech |
PERENNIAL ENERGY and Origin Agritech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PERENNIAL ENERGY and Origin Agritech
The main advantage of trading using opposite PERENNIAL ENERGY and Origin Agritech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PERENNIAL ENERGY 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.| PERENNIAL ENERGY vs. Tianjin Capital Environmental | PERENNIAL ENERGY vs. COPLAND ROAD CAPITAL | PERENNIAL ENERGY vs. Gaztransport Technigaz SA | PERENNIAL ENERGY vs. GOLD ROAD RES |
| Origin Agritech vs. FORMPIPE SOFTWARE AB | Origin Agritech vs. PTT Global Chemical | Origin Agritech vs. Magic Software Enterprises | Origin Agritech vs. UPDATE SOFTWARE |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules |