Correlation Between Jiayin and IShares IBonds

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

By analyzing existing cross correlation between Jiayin Group and iShares iBonds Dec, you can compare the effects of market volatilities on Jiayin and IShares IBonds 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 Jiayin with a short position of IShares IBonds. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiayin and IShares IBonds.

Diversification Opportunities for Jiayin and IShares IBonds

0.27

Correlation Coefficient

Jiayin  IShares IBonds

Modest diversification

The 3 months correlation between Jiayin and IShares is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Jiayin Group and iShares iBonds Dec in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares iBonds Dec and Jiayin 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 Jiayin Group are associated (or correlated) with IShares IBonds. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares iBonds Dec has no effect on the direction of Jiayin i.e., Jiayin and IShares IBonds go up and down completely randomly.

Pair Corralation between Jiayin and IShares IBonds

Given the investment horizon of 90 days Jiayin Group is expected to generate 13.99 times more return on investment than IShares IBonds. However, Jiayin is 13.99 times more volatile than iShares iBonds Dec. It trades about 0.26 of its potential returns per unit of risk. iShares iBonds Dec is currently generating about 0.1 per unit of risk. If you would invest  647.00  in Jiayin Group on October 20, 2024 and sell it today you would earn a total of  83.00  from holding Jiayin Group or generate 12.83% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	95.0%
Values	Daily Returns

Jiayin Group  vs.  iShares iBonds Dec

Jiayin Group

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Jiayin Group are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of very fragile forward indicators, Jiayin may actually be approaching a critical reversion point that can send shares even higher in February 2025.

iShares iBonds Dec

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days iShares iBonds Dec has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, IShares IBonds is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Jiayin and IShares IBonds

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

The idea behind Jiayin Group and iShares iBonds Dec 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.