Correlation Between JinkoSolar Holding and Bavarian Nordic

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

By analyzing existing cross correlation between JinkoSolar Holding and Bavarian Nordic AS, you can compare the effects of market volatilities on JinkoSolar Holding and Bavarian Nordic 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 Bavarian Nordic. Check out your portfolio center. Please also check ongoing floating volatility patterns of JinkoSolar Holding and Bavarian Nordic.

Diversification Opportunities for JinkoSolar Holding and Bavarian Nordic

-0.04

Correlation Coefficient

JinkoSolar Holding  Bavarian Nordic

Good diversification

The 3 months correlation between JinkoSolar and Bavarian is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding JinkoSolar Holding and Bavarian Nordic AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bavarian Nordic AS 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 Bavarian Nordic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bavarian Nordic AS has no effect on the direction of JinkoSolar Holding i.e., JinkoSolar Holding and Bavarian Nordic go up and down completely randomly.

Pair Corralation between JinkoSolar Holding and Bavarian Nordic

Considering the 90-day investment horizon JinkoSolar Holding is expected to generate 2.06 times more return on investment than Bavarian Nordic. However, JinkoSolar Holding is 2.06 times more volatile than Bavarian Nordic AS. It trades about 0.07 of its potential returns per unit of risk. Bavarian Nordic AS is currently generating about -0.07 per unit of risk. If you would invest  2,505  in JinkoSolar Holding on October 5, 2024 and sell it today you would earn a total of  96.00  from holding JinkoSolar Holding or generate 3.83% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

JinkoSolar Holding  vs.  Bavarian Nordic AS

JinkoSolar Holding

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days JinkoSolar Holding has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's forward-looking signals remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Bavarian Nordic AS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Bavarian Nordic AS has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with JinkoSolar Holding and Bavarian Nordic

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

The idea behind JinkoSolar Holding and Bavarian Nordic AS 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.