Correlation Between Circuit Fabology and Jinxiandai Information

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

By analyzing existing cross correlation between Circuit Fabology Microelectronics and Jinxiandai Information Industry, you can compare the effects of market volatilities on Circuit Fabology and Jinxiandai Information 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 Circuit Fabology with a short position of Jinxiandai Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Circuit Fabology and Jinxiandai Information.

Diversification Opportunities for Circuit Fabology and Jinxiandai Information

0.09

Correlation Coefficient

Circuit Fabology  Jinxiandai Information

Significant diversification

The 3 months correlation between Circuit and Jinxiandai is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Circuit Fabology Microelectron and Jinxiandai Information Industr in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jinxiandai Information and Circuit Fabology 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 Circuit Fabology Microelectronics are associated (or correlated) with Jinxiandai Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jinxiandai Information has no effect on the direction of Circuit Fabology i.e., Circuit Fabology and Jinxiandai Information go up and down completely randomly.

Pair Corralation between Circuit Fabology and Jinxiandai Information

Assuming the 90 days trading horizon Circuit Fabology Microelectronics is expected to generate 0.59 times more return on investment than Jinxiandai Information. However, Circuit Fabology Microelectronics is 1.7 times less risky than Jinxiandai Information. It trades about -0.2 of its potential returns per unit of risk. Jinxiandai Information Industry is currently generating about -0.35 per unit of risk. If you would invest  6,371  in Circuit Fabology Microelectronics on October 11, 2024 and sell it today you would lose (684.00) from holding Circuit Fabology Microelectronics or give up 10.74% of portfolio value over 90 days.

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

Circuit Fabology Microelectron  vs.  Jinxiandai Information Industr

Circuit Fabology Mic

Risk-Adjusted Performance

0 of 100

Very Weak

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

Jinxiandai Information

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Jinxiandai Information Industry are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Jinxiandai Information sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Circuit Fabology and Jinxiandai Information

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

The idea behind Circuit Fabology Microelectronics and Jinxiandai Information Industry 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 Anywhere module to track or share privately all of your investments from the convenience of any device.