Correlation Between JinkoSolar Holding and Boston Scientific

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

By analyzing existing cross correlation between JinkoSolar Holding and Boston Scientific, you can compare the effects of market volatilities on JinkoSolar Holding and Boston Scientific 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 JinkoSolar Holding with a short position of Boston Scientific. Check out your portfolio center. Please also check ongoing floating volatility patterns of JinkoSolar Holding and Boston Scientific.

Diversification Opportunities for JinkoSolar Holding and Boston Scientific

0.1

Correlation Coefficient

JinkoSolar Holding  Boston Scientific

Average diversification

The 3 months correlation between JinkoSolar and Boston is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding JinkoSolar Holding and Boston Scientific in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boston Scientific and JinkoSolar Holding 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 JinkoSolar Holding are associated (or correlated) with Boston Scientific. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boston Scientific has no effect on the direction of JinkoSolar Holding i.e., JinkoSolar Holding and Boston Scientific go up and down completely randomly.

Pair Corralation between JinkoSolar Holding and Boston Scientific

Considering the 90-day investment horizon JinkoSolar Holding is expected to generate 1.65 times less return on investment than Boston Scientific. In addition to that, JinkoSolar Holding is 2.79 times more volatile than Boston Scientific. It trades about 0.03 of its total potential returns per unit of risk. Boston Scientific is currently generating about 0.15 per unit of volatility. If you would invest  8,550  in Boston Scientific on October 20, 2024 and sell it today you would earn a total of  800.00  from holding Boston Scientific or generate 9.36% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	95.12%
Values	Daily Returns

JinkoSolar Holding  vs.  Boston Scientific

JinkoSolar Holding

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in JinkoSolar Holding are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak forward-looking signals, JinkoSolar Holding unveiled solid returns over the last few months and may actually be approaching a breakup point.

Boston Scientific

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Boston Scientific are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Boston Scientific reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with JinkoSolar Holding and Boston Scientific

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

The idea behind JinkoSolar Holding and Boston Scientific 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 Global Correlations module to find global opportunities by holding instruments from different markets.