Correlation Between JIN MEDICAL and Nexgel

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

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

Diversification Opportunities for JIN MEDICAL and Nexgel

0.03

Correlation Coefficient

JIN MEDICAL  Nexgel

Significant diversification

The 3 months correlation between JIN and Nexgel is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding JIN MEDICAL INTERNATIONAL and Nexgel Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nexgel Inc and JIN MEDICAL 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 JIN MEDICAL INTERNATIONAL are associated (or correlated) with Nexgel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nexgel Inc has no effect on the direction of JIN MEDICAL i.e., JIN MEDICAL and Nexgel go up and down completely randomly.

Pair Corralation between JIN MEDICAL and Nexgel

Given the investment horizon of 90 days JIN MEDICAL is expected to generate 1.55 times less return on investment than Nexgel. In addition to that, JIN MEDICAL is 1.69 times more volatile than Nexgel Inc. It trades about 0.01 of its total potential returns per unit of risk. Nexgel Inc is currently generating about 0.02 per unit of volatility. If you would invest  318.00  in Nexgel Inc on November 29, 2024 and sell it today you would lose (2.00) from holding Nexgel Inc or give up 0.63% of portfolio value over 90 days.

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

JIN MEDICAL INTERNATIONAL  vs.  Nexgel Inc

JIN MEDICAL INTERNATIONAL

Risk-Adjusted Performance

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 quite persistent basic indicators, JIN MEDICAL is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Nexgel Inc

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Nexgel Inc are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting technical and fundamental indicators, Nexgel may actually be approaching a critical reversion point that can send shares even higher in March 2025.

Pair Trading with JIN MEDICAL and Nexgel

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

The idea behind JIN MEDICAL INTERNATIONAL and Nexgel Inc 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 Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.