Correlation Between Q2 Holdings and JIN MEDICAL

Can any of the company-specific risk be diversified away by investing in both Q2 Holdings and JIN MEDICAL 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 Q2 Holdings and JIN MEDICAL into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Q2 Holdings and JIN MEDICAL INTERNATIONAL, you can compare the effects of market volatilities on Q2 Holdings and JIN MEDICAL 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 Q2 Holdings with a short position of JIN MEDICAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Q2 Holdings and JIN MEDICAL.

Diversification Opportunities for Q2 Holdings and JIN MEDICAL

-0.94

Correlation Coefficient

Q2 Holdings  JIN MEDICAL

Pay attention - limited upside

The 3 months correlation between QTWO and JIN is -0.94. Overlapping area represents the amount of risk that can be diversified away by holding Q2 Holdings and JIN MEDICAL INTERNATIONAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JIN MEDICAL INTERNATIONAL and Q2 Holdings 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 Q2 Holdings are associated (or correlated) with JIN MEDICAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JIN MEDICAL INTERNATIONAL has no effect on the direction of Q2 Holdings i.e., Q2 Holdings and JIN MEDICAL go up and down completely randomly.

Pair Corralation between Q2 Holdings and JIN MEDICAL

Given the investment horizon of 90 days Q2 Holdings is expected to under-perform the JIN MEDICAL. But the stock apears to be less risky and, when comparing its historical volatility, Q2 Holdings is 6.74 times less risky than JIN MEDICAL. The stock trades about -0.24 of its potential returns per unit of risk. The JIN MEDICAL INTERNATIONAL is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  80.00  in JIN MEDICAL INTERNATIONAL on October 10, 2024 and sell it today you would earn a total of  9.00  from holding JIN MEDICAL INTERNATIONAL or generate 11.25% return on investment over 90 days.

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

Q2 Holdings  vs.  JIN MEDICAL INTERNATIONAL

Q2 Holdings

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Q2 Holdings are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of very abnormal basic indicators, Q2 Holdings displayed solid returns over the last few months and may actually be approaching a breakup point.

JIN MEDICAL INTERNATIONAL

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days JIN MEDICAL INTERNATIONAL has generated negative risk-adjusted returns adding no value to investors with long positions. Despite abnormal performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in February 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Q2 Holdings and JIN MEDICAL

The main advantage of trading using opposite Q2 Holdings and JIN MEDICAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Q2 Holdings position performs unexpectedly, JIN MEDICAL 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 JIN MEDICAL will offset losses from the drop in JIN MEDICAL's long position.

The idea behind Q2 Holdings and JIN MEDICAL 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.