Correlation Between JIAHUA STORES and Ping An

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

By analyzing existing cross correlation between JIAHUA STORES and Ping An Insurance, you can compare the effects of market volatilities on JIAHUA STORES and Ping An 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 JIAHUA STORES with a short position of Ping An. Check out your portfolio center. Please also check ongoing floating volatility patterns of JIAHUA STORES and Ping An.

Diversification Opportunities for JIAHUA STORES and Ping An

0.0

Correlation Coefficient

JIAHUA STORES  Ping An

Pay attention - limited upside

The 3 months correlation between JIAHUA and Ping is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding JIAHUA STORES and Ping An Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ping An Insurance and JIAHUA STORES 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 JIAHUA STORES are associated (or correlated) with Ping An. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ping An Insurance has no effect on the direction of JIAHUA STORES i.e., JIAHUA STORES and Ping An go up and down completely randomly.

Pair Corralation between JIAHUA STORES and Ping An

If you would invest  401.00  in Ping An Insurance on September 14, 2024 and sell it today you would earn a total of  177.00  from holding Ping An Insurance or generate 44.14% return on investment over 90 days.

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

JIAHUA STORES  vs.  Ping An Insurance

JIAHUA STORES

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days JIAHUA STORES has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, JIAHUA STORES is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Ping An Insurance

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Ping An Insurance are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Ping An unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with JIAHUA STORES and Ping An

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

The idea behind JIAHUA STORES and Ping An Insurance 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.