Correlation Between Alphabet and Jinli Group

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

By analyzing existing cross correlation between Alphabet Inc Class C and Jinli Group Holdings, you can compare the effects of market volatilities on Alphabet and Jinli Group 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 Alphabet with a short position of Jinli Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alphabet and Jinli Group.

Diversification Opportunities for Alphabet and Jinli Group

-0.36

Correlation Coefficient

Alphabet  Jinli Group

Very good diversification

The 3 months correlation between Alphabet and Jinli is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Alphabet Inc Class C and Jinli Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jinli Group Holdings and Alphabet 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 Alphabet Inc Class C are associated (or correlated) with Jinli Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jinli Group Holdings has no effect on the direction of Alphabet i.e., Alphabet and Jinli Group go up and down completely randomly.

Pair Corralation between Alphabet and Jinli Group

Given the investment horizon of 90 days Alphabet Inc Class C is expected to generate 0.98 times more return on investment than Jinli Group. However, Alphabet Inc Class C is 1.03 times less risky than Jinli Group. It trades about 0.07 of its potential returns per unit of risk. Jinli Group Holdings is currently generating about 0.02 per unit of risk. If you would invest  10,071  in Alphabet Inc Class C on December 5, 2024 and sell it today you would earn a total of  6,795  from holding Alphabet Inc Class C or generate 67.47% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	97.57%
Values	Daily Returns

Alphabet Inc Class C  vs.  Jinli Group Holdings

Alphabet Class C

Risk-Adjusted Performance

Very Weak

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

Jinli Group Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days Jinli Group Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with Alphabet and Jinli Group

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

The idea behind Alphabet Inc Class C and Jinli Group Holdings 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.