Correlation Between Jiayin and Midcap Growth
Can any of the company-specific risk be diversified away by investing in both Jiayin and Midcap Growth 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 Midcap Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jiayin Group and Midcap Growth Fund, you can compare the effects of market volatilities on Jiayin and Midcap Growth 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 Midcap Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiayin and Midcap Growth.
Diversification Opportunities for Jiayin and Midcap Growth
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Jiayin and Midcap is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Jiayin Group and Midcap Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Midcap Growth 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 Midcap Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Midcap Growth has no effect on the direction of Jiayin i.e., Jiayin and Midcap Growth go up and down completely randomly.
Pair Corralation between Jiayin and Midcap Growth
Given the investment horizon of 90 days Jiayin Group is expected to generate 3.84 times more return on investment than Midcap Growth. However, Jiayin is 3.84 times more volatile than Midcap Growth Fund. It trades about 0.06 of its potential returns per unit of risk. Midcap Growth Fund is currently generating about 0.07 per unit of risk. If you would invest 273.00 in Jiayin Group on October 4, 2024 and sell it today you would earn a total of 382.00 from holding Jiayin Group or generate 139.93% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 94.96% |
Values | Daily Returns |
Jiayin Group vs. Midcap Growth Fund
Performance |
Timeline |
Jiayin Group |
Midcap Growth |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Strong
Jiayin and Midcap Growth Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Jiayin and Midcap Growth
The main advantage of trading using opposite Jiayin and Midcap Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiayin position performs unexpectedly, Midcap Growth 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 Midcap Growth will offset losses from the drop in Midcap Growth's long position.Jiayin vs. Oriental Culture Holding | Jiayin vs. Wisekey International Holding | Jiayin vs. Wah Fu Education |
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Check out your portfolio center.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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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