Correlation Between Jiayin and Silver Bull

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

By analyzing existing cross correlation between Jiayin Group and Silver Bull Resources, you can compare the effects of market volatilities on Jiayin and Silver Bull 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 Silver Bull. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiayin and Silver Bull.

Diversification Opportunities for Jiayin and Silver Bull

0.13

Correlation Coefficient

Jiayin  Silver Bull

Average diversification

The 3 months correlation between Jiayin and Silver is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Jiayin Group and Silver Bull Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Silver Bull Resources 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 Silver Bull. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Silver Bull Resources has no effect on the direction of Jiayin i.e., Jiayin and Silver Bull go up and down completely randomly.

Pair Corralation between Jiayin and Silver Bull

Given the investment horizon of 90 days Jiayin Group is expected to under-perform the Silver Bull. But the stock apears to be less risky and, when comparing its historical volatility, Jiayin Group is 1.11 times less risky than Silver Bull. The stock trades about -0.07 of its potential returns per unit of risk. The Silver Bull Resources is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  13.00  in Silver Bull Resources on October 5, 2024 and sell it today you would earn a total of  0.00  from holding Silver Bull Resources or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.36%
Values	Daily Returns

Jiayin Group  vs.  Silver Bull Resources

Jiayin Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Jiayin Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's forward indicators remain very healthy which may send shares a bit higher in February 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Silver Bull Resources

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Silver Bull Resources are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy fundamental drivers, Silver Bull is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Jiayin and Silver Bull

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

The idea behind Jiayin Group and Silver Bull Resources 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.