Correlation Between Jiayin and CROWN

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

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

Diversification Opportunities for Jiayin and CROWN

0.68

Correlation Coefficient

Jiayin  CROWN

Poor diversification

The 3 months correlation between Jiayin and CROWN is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Jiayin Group and CROWN CASTLE INTERNATIONAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CROWN CASTLE INTERNA 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 CROWN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CROWN CASTLE INTERNA has no effect on the direction of Jiayin i.e., Jiayin and CROWN go up and down completely randomly.

Pair Corralation between Jiayin and CROWN

Given the investment horizon of 90 days Jiayin is expected to generate 16.02 times less return on investment than CROWN. But when comparing it to its historical volatility, Jiayin Group is 15.96 times less risky than CROWN. It trades about 0.06 of its potential returns per unit of risk. CROWN CASTLE INTERNATIONAL is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  7,118  in CROWN CASTLE INTERNATIONAL on October 4, 2024 and sell it today you would earn a total of  145.00  from holding CROWN CASTLE INTERNATIONAL or generate 2.04% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	84.04%
Values	Daily Returns

Jiayin Group  vs.  CROWN CASTLE INTERNATIONAL

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 latest fragile performance, the Stock's forward indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

CROWN CASTLE INTERNA

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in CROWN CASTLE INTERNATIONAL are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, CROWN is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Jiayin and CROWN

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

The idea behind Jiayin Group and CROWN CASTLE INTERNATIONAL 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.

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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.