Correlation Between Kering SA and Origin Agritech
Can any of the company-specific risk be diversified away by investing in both Kering SA 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 Kering SA and Origin Agritech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kering SA and Origin Agritech, you can compare the effects of market volatilities on Kering SA 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 Kering SA with a short position of Origin Agritech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kering SA and Origin Agritech.
Diversification Opportunities for Kering SA and Origin Agritech
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Kering and Origin is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Kering SA and Origin Agritech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Origin Agritech and Kering SA 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 Kering SA 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 Kering SA i.e., Kering SA and Origin Agritech go up and down completely randomly.
Pair Corralation between Kering SA and Origin Agritech
Assuming the 90 days horizon Kering SA is expected to under-perform the Origin Agritech. But the stock apears to be less risky and, when comparing its historical volatility, Kering SA is 3.05 times less risky than Origin Agritech. The stock trades about -0.09 of its potential returns per unit of risk. The Origin Agritech is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 490.00 in Origin Agritech on August 31, 2024 and sell it today you would lose (248.00) from holding Origin Agritech or give up 50.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kering SA vs. Origin Agritech
Performance |
| Timeline |
| Kering SA |
| Origin Agritech |
Kering SA and Origin Agritech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kering SA and Origin Agritech
The main advantage of trading using opposite Kering SA and Origin Agritech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kering SA 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.| Kering SA vs. TITANIUM TRANSPORTGROUP | Kering SA vs. NTG Nordic Transport | Kering SA vs. KAUFMAN ET BROAD | Kering SA vs. Gaztransport Technigaz SA |
| 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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