Correlation Between Soyea Technology and Jiajia Food

Can any of the company-specific risk be diversified away by investing in both Soyea Technology and Jiajia Food 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 Soyea Technology and Jiajia Food into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Soyea Technology Co and Jiajia Food Group, you can compare the effects of market volatilities on Soyea Technology and Jiajia Food 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 Soyea Technology with a short position of Jiajia Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Soyea Technology and Jiajia Food.

Diversification Opportunities for Soyea Technology and Jiajia Food

0.91

Correlation Coefficient

Soyea Technology  Jiajia Food

Almost no diversification

The 3 months correlation between Soyea and Jiajia is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Soyea Technology Co and Jiajia Food Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiajia Food Group and Soyea Technology 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 Soyea Technology Co are associated (or correlated) with Jiajia Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiajia Food Group has no effect on the direction of Soyea Technology i.e., Soyea Technology and Jiajia Food go up and down completely randomly.

Pair Corralation between Soyea Technology and Jiajia Food

Assuming the 90 days trading horizon Soyea Technology is expected to generate 642.0 times less return on investment than Jiajia Food. In addition to that, Soyea Technology is 1.02 times more volatile than Jiajia Food Group. It trades about 0.0 of its total potential returns per unit of risk. Jiajia Food Group is currently generating about 0.02 per unit of volatility. If you would invest  457.00  in Jiajia Food Group on September 16, 2024 and sell it today you would earn a total of  59.00  from holding Jiajia Food Group or generate 12.91% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

Soyea Technology Co  vs.  Jiajia Food Group

Soyea Technology

Risk-Adjusted Performance

36 of 100

Very Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Soyea Technology Co are ranked lower than 36 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Soyea Technology sustained solid returns over the last few months and may actually be approaching a breakup point.

Jiajia Food Group

Risk-Adjusted Performance

35 of 100

Very Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Jiajia Food Group are ranked lower than 35 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Jiajia Food sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Soyea Technology and Jiajia Food

The main advantage of trading using opposite Soyea Technology and Jiajia Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Soyea Technology position performs unexpectedly, Jiajia Food 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 Jiajia Food will offset losses from the drop in Jiajia Food's long position.

The idea behind Soyea Technology Co and Jiajia Food Group pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.