Correlation Between SoFi Technologies and Jiangsu Expressway
Can any of the company-specific risk be diversified away by investing in both SoFi Technologies and Jiangsu Expressway 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 SoFi Technologies and Jiangsu Expressway into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SoFi Technologies and Jiangsu Expressway, you can compare the effects of market volatilities on SoFi Technologies and Jiangsu Expressway 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 SoFi Technologies with a short position of Jiangsu Expressway. Check out your portfolio center. Please also check ongoing floating volatility patterns of SoFi Technologies and Jiangsu Expressway.
Diversification Opportunities for SoFi Technologies and Jiangsu Expressway
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between SoFi and Jiangsu is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding SoFi Technologies and Jiangsu Expressway in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangsu Expressway and SoFi Technologies 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 SoFi Technologies are associated (or correlated) with Jiangsu Expressway. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangsu Expressway has no effect on the direction of SoFi Technologies i.e., SoFi Technologies and Jiangsu Expressway go up and down completely randomly.
Pair Corralation between SoFi Technologies and Jiangsu Expressway
Given the investment horizon of 90 days SoFi Technologies is expected to generate 0.64 times more return on investment than Jiangsu Expressway. However, SoFi Technologies is 1.57 times less risky than Jiangsu Expressway. It trades about 0.23 of its potential returns per unit of risk. Jiangsu Expressway is currently generating about 0.04 per unit of risk. If you would invest 1,411 in SoFi Technologies on September 12, 2024 and sell it today you would earn a total of 183.00 from holding SoFi Technologies or generate 12.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
SoFi Technologies vs. Jiangsu Expressway
Performance |
| Timeline |
| SoFi Technologies |
| Jiangsu Expressway |
SoFi Technologies and Jiangsu Expressway Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SoFi Technologies and Jiangsu Expressway
The main advantage of trading using opposite SoFi Technologies and Jiangsu Expressway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SoFi Technologies position performs unexpectedly, Jiangsu Expressway 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 Jiangsu Expressway will offset losses from the drop in Jiangsu Expressway's long position.| SoFi Technologies vs. Victory Integrity Smallmid Cap | SoFi Technologies vs. Hilton Worldwide Holdings | SoFi Technologies vs. NVIDIA | SoFi Technologies vs. JPMorgan Chase Co |
| Jiangsu Expressway vs. Recursion Pharmaceuticals | Jiangsu Expressway vs. SoFi Technologies | Jiangsu Expressway vs. PayPal Holdings | Jiangsu Expressway vs. Intuitive Machines |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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