Correlation Between Origin Agritech and Media

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

By analyzing existing cross correlation between Origin Agritech and Media and Games, you can compare the effects of market volatilities on Origin Agritech and Media 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 Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Origin Agritech and Media.

Diversification Opportunities for Origin Agritech and Media

0.14

Correlation Coefficient

Origin Agritech  Media

Average diversification

The 3 months correlation between Origin and Media is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Origin Agritech and Media and Games in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Media and Games 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 Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Media and Games has no effect on the direction of Origin Agritech i.e., Origin Agritech and Media go up and down completely randomly.

Pair Corralation between Origin Agritech and Media

Assuming the 90 days trading horizon Origin Agritech is expected to generate 9.29 times less return on investment than Media. In addition to that, Origin Agritech is 1.44 times more volatile than Media and Games. It trades about 0.0 of its total potential returns per unit of risk. Media and Games is currently generating about 0.02 per unit of volatility. If you would invest  315.00  in Media and Games on December 30, 2024 and sell it today you would earn a total of  5.00  from holding Media and Games or generate 1.59% return on investment over 90 days.

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

Origin Agritech  vs.  Media and Games

Origin Agritech

Risk-Adjusted Performance

Very Weak

Over the last 90 days Origin Agritech has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Origin Agritech is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Media and Games

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Media and Games are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable technical and fundamental indicators, Media is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Origin Agritech and Media

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

The idea behind Origin Agritech and Media and Games 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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.