Correlation Between Origin Agritech and HALSTEAD JAMES

Can any of the company-specific risk be diversified away by investing in both Origin Agritech and HALSTEAD JAMES 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 Origin Agritech and HALSTEAD JAMES into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Origin Agritech and HALSTEAD JAMES LS 05, you can compare the effects of market volatilities on Origin Agritech and HALSTEAD JAMES 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 Origin Agritech with a short position of HALSTEAD JAMES. Check out your portfolio center. Please also check ongoing floating volatility patterns of Origin Agritech and HALSTEAD JAMES.

Diversification Opportunities for Origin Agritech and HALSTEAD JAMES

-0.32

Correlation Coefficient

Origin Agritech  HALSTEAD JAMES

Very good diversification

The 3 months correlation between Origin and HALSTEAD is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Origin Agritech and HALSTEAD JAMES LS 05 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HALSTEAD JAMES LS and Origin Agritech 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 Origin Agritech are associated (or correlated) with HALSTEAD JAMES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HALSTEAD JAMES LS has no effect on the direction of Origin Agritech i.e., Origin Agritech and HALSTEAD JAMES go up and down completely randomly.

Pair Corralation between Origin Agritech and HALSTEAD JAMES

Assuming the 90 days trading horizon Origin Agritech is expected to generate 3.2 times less return on investment than HALSTEAD JAMES. In addition to that, Origin Agritech is 2.11 times more volatile than HALSTEAD JAMES LS 05. It trades about 0.02 of its total potential returns per unit of risk. HALSTEAD JAMES LS 05 is currently generating about 0.13 per unit of volatility. If you would invest  184.00  in HALSTEAD JAMES LS 05 on September 18, 2024 and sell it today you would earn a total of  36.00  from holding HALSTEAD JAMES LS 05 or generate 19.57% return on investment over 90 days.

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

Origin Agritech  vs.  HALSTEAD JAMES LS 05

Origin Agritech

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Origin Agritech are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Origin Agritech is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

HALSTEAD JAMES LS

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in HALSTEAD JAMES LS 05 are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile forward-looking indicators, HALSTEAD JAMES reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Origin Agritech and HALSTEAD JAMES

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

The idea behind Origin Agritech and HALSTEAD JAMES LS 05 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.