Correlation Between Yunnan Jianzhijia and V V

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

By analyzing existing cross correlation between Yunnan Jianzhijia Health Chain and V V Food, you can compare the effects of market volatilities on Yunnan Jianzhijia and V V 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 Yunnan Jianzhijia with a short position of V V. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yunnan Jianzhijia and V V.

Diversification Opportunities for Yunnan Jianzhijia and V V

0.42

Correlation Coefficient

Yunnan Jianzhijia  V V

Very weak diversification

The 3 months correlation between Yunnan and 600300 is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Yunnan Jianzhijia Health Chain and V V Food in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on V V Food and Yunnan Jianzhijia 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 Yunnan Jianzhijia Health Chain are associated (or correlated) with V V. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of V V Food has no effect on the direction of Yunnan Jianzhijia i.e., Yunnan Jianzhijia and V V go up and down completely randomly.

Pair Corralation between Yunnan Jianzhijia and V V

Assuming the 90 days trading horizon Yunnan Jianzhijia is expected to generate 2.88 times less return on investment than V V. In addition to that, Yunnan Jianzhijia is 1.26 times more volatile than V V Food. It trades about 0.01 of its total potential returns per unit of risk. V V Food is currently generating about 0.02 per unit of volatility. If you would invest  293.00  in V V Food on October 26, 2024 and sell it today you would earn a total of  3.00  from holding V V Food or generate 1.02% return on investment over 90 days.

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

Yunnan Jianzhijia Health Chain  vs.  V V Food

Yunnan Jianzhijia

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Yunnan Jianzhijia Health Chain has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Yunnan Jianzhijia is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

V V Food

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in V V Food are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, V V is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Yunnan Jianzhijia and V V

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

The idea behind Yunnan Jianzhijia Health Chain and V V Food 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.