Correlation Between JuneYao Dairy and G Bits

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

By analyzing existing cross correlation between JuneYao Dairy Co and G bits Network Technology, you can compare the effects of market volatilities on JuneYao Dairy and G Bits 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 JuneYao Dairy with a short position of G Bits. Check out your portfolio center. Please also check ongoing floating volatility patterns of JuneYao Dairy and G Bits.

Diversification Opportunities for JuneYao Dairy and G Bits

0.13

Correlation Coefficient

JuneYao Dairy  G Bits

Average diversification

The 3 months correlation between JuneYao and 603444 is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding JuneYao Dairy Co and G bits Network Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on G bits Network and JuneYao Dairy 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 JuneYao Dairy Co are associated (or correlated) with G Bits. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of G bits Network has no effect on the direction of JuneYao Dairy i.e., JuneYao Dairy and G Bits go up and down completely randomly.

Pair Corralation between JuneYao Dairy and G Bits

Assuming the 90 days trading horizon JuneYao Dairy Co is expected to generate 1.21 times more return on investment than G Bits. However, JuneYao Dairy is 1.21 times more volatile than G bits Network Technology. It trades about 0.05 of its potential returns per unit of risk. G bits Network Technology is currently generating about -0.03 per unit of risk. If you would invest  611.00  in JuneYao Dairy Co on September 28, 2024 and sell it today you would earn a total of  46.00  from holding JuneYao Dairy Co or generate 7.53% return on investment over 90 days.

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

JuneYao Dairy Co  vs.  G bits Network Technology

JuneYao Dairy

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in JuneYao Dairy Co are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, JuneYao Dairy may actually be approaching a critical reversion point that can send shares even higher in January 2025.

G bits Network

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days G bits Network Technology has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, G Bits is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with JuneYao Dairy and G Bits

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

The idea behind JuneYao Dairy Co and G bits Network Technology 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.