Correlation Between Scientific Games and Origin Agritech
Can any of the company-specific risk be diversified away by investing in both Scientific Games 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 Scientific Games and Origin Agritech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Scientific Games and Origin Agritech, you can compare the effects of market volatilities on Scientific Games 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 Scientific Games with a short position of Origin Agritech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Scientific Games and Origin Agritech.
Diversification Opportunities for Scientific Games and Origin Agritech
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Scientific and Origin is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Scientific Games and Origin Agritech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Origin Agritech and Scientific Games 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 Scientific Games 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 Scientific Games i.e., Scientific Games and Origin Agritech go up and down completely randomly.
Pair Corralation between Scientific Games and Origin Agritech
Assuming the 90 days horizon Scientific Games is expected to generate 0.35 times more return on investment than Origin Agritech. However, Scientific Games is 2.9 times less risky than Origin Agritech. It trades about 0.05 of its potential returns per unit of risk. Origin Agritech is currently generating about -0.01 per unit of risk. If you would invest 6,150 in Scientific Games on September 3, 2024 and sell it today you would earn a total of 2,950 from holding Scientific Games or generate 47.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Scientific Games vs. Origin Agritech
Performance |
| Timeline |
| Scientific Games |
| Origin Agritech |
Scientific Games and Origin Agritech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Scientific Games and Origin Agritech
The main advantage of trading using opposite Scientific Games and Origin Agritech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Scientific Games 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.| Scientific Games vs. Apple Inc | Scientific Games vs. Apple Inc | Scientific Games vs. Apple Inc | Scientific Games vs. Apple Inc |
| Origin Agritech vs. Gamma Communications plc | Origin Agritech vs. Chunghwa Telecom Co | Origin Agritech vs. Citic Telecom International | Origin Agritech vs. Ribbon Communications |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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