Correlation Between Jiangsu Apon and Holitech Technology

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

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

Diversification Opportunities for Jiangsu Apon and Holitech Technology

-0.16

Correlation Coefficient

Jiangsu Apon  Holitech Technology

Good diversification

The 3 months correlation between Jiangsu and Holitech is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Jiangsu Apon Medical and Holitech Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Holitech Technology and Jiangsu Apon 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 Jiangsu Apon Medical are associated (or correlated) with Holitech Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Holitech Technology has no effect on the direction of Jiangsu Apon i.e., Jiangsu Apon and Holitech Technology go up and down completely randomly.

Pair Corralation between Jiangsu Apon and Holitech Technology

Assuming the 90 days trading horizon Jiangsu Apon Medical is expected to generate 2.19 times more return on investment than Holitech Technology. However, Jiangsu Apon is 2.19 times more volatile than Holitech Technology Co. It trades about 0.07 of its potential returns per unit of risk. Holitech Technology Co is currently generating about -0.13 per unit of risk. If you would invest  2,036  in Jiangsu Apon Medical on December 26, 2024 and sell it today you would earn a total of  294.00  from holding Jiangsu Apon Medical or generate 14.44% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Jiangsu Apon Medical  vs.  Holitech Technology Co

Jiangsu Apon Medical

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Jiangsu Apon Medical are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Jiangsu Apon sustained solid returns over the last few months and may actually be approaching a breakup point.

Holitech Technology

Risk-Adjusted Performance

Very Weak

Over the last 90 days Holitech Technology Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Jiangsu Apon and Holitech Technology

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

The idea behind Jiangsu Apon Medical and Holitech Technology Co 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.

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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.