Correlation Between Uxin and Jiuzi Holdings

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

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

Diversification Opportunities for Uxin and Jiuzi Holdings

-0.08

Correlation Coefficient

Uxin  Jiuzi Holdings

Good diversification

The 3 months correlation between Uxin and Jiuzi is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Uxin and Jiuzi Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiuzi Holdings and Uxin 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 Uxin are associated (or correlated) with Jiuzi Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiuzi Holdings has no effect on the direction of Uxin i.e., Uxin and Jiuzi Holdings go up and down completely randomly.

Pair Corralation between Uxin and Jiuzi Holdings

Given the investment horizon of 90 days Uxin is expected to generate 27.01 times less return on investment than Jiuzi Holdings. But when comparing it to its historical volatility, Uxin is 3.52 times less risky than Jiuzi Holdings. It trades about 0.02 of its potential returns per unit of risk. Jiuzi Holdings is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest  112.00  in Jiuzi Holdings on October 11, 2024 and sell it today you would earn a total of  47.00  from holding Jiuzi Holdings or generate 41.96% return on investment over 90 days.

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

Uxin  vs.  Jiuzi Holdings

Uxin

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Uxin has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy forward indicators, Uxin is not utilizing all of its potentials. The newest stock price disarray, may contribute to short-term losses for the investors.

Jiuzi Holdings

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Jiuzi Holdings are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of very weak basic indicators, Jiuzi Holdings displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Uxin and Jiuzi Holdings

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

The idea behind Uxin and Jiuzi Holdings 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.