Correlation Between Origin Agritech and American Express

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Can any of the company-specific risk be diversified away by investing in both Origin Agritech and American Express 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 Origin Agritech and American Express into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Origin Agritech and American Express, you can compare the effects of market volatilities on Origin Agritech and American Express 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 Origin Agritech with a short position of American Express. Check out your portfolio center. Please also check ongoing floating volatility patterns of Origin Agritech and American Express.

Diversification Opportunities for Origin Agritech and American Express

0.62
  Correlation Coefficient

Poor diversification

The 3 months correlation between Origin and American is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Origin Agritech and American Express in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Express and Origin Agritech 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 Origin Agritech are associated (or correlated) with American Express. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Express has no effect on the direction of Origin Agritech i.e., Origin Agritech and American Express go up and down completely randomly.

Pair Corralation between Origin Agritech and American Express

Given the investment horizon of 90 days Origin Agritech is expected to generate 2.15 times more return on investment than American Express. However, Origin Agritech is 2.15 times more volatile than American Express. It trades about -0.05 of its potential returns per unit of risk. American Express is currently generating about -0.18 per unit of risk. If you would invest  890.00  in Origin Agritech on April 2, 2022 and sell it today you would lose (148.00)  from holding Origin Agritech or give up 16.63% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Origin Agritech  vs.  American Express

 Performance (%) 
      Timeline 
Origin Agritech 
Origin Performance
0 of 100
Over the last 90 days Origin Agritech has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, Origin Agritech is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Origin Price Channel

American Express 
American Performance
0 of 100
Over the last 90 days American Express has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in August 2022. The recent disarray may also be a sign of long period up-swing for the firm insiders.

Structure and Payout Changes

Forward Annual Dividend Yield
0.0144
Payout Ratio
0.19
Last Split Factor
10000:8753
Forward Annual Dividend Rate
2.08
Dividend Date
2022-08-10
Ex Dividend Date
2022-06-30
Last Split Date
2005-10-03

American Price Channel

Origin Agritech and American Express Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with Origin Agritech and American Express

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

American Express

Pair trading matchups for American Express

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 ETF Directory module to find actively traded Exchange Traded Funds (ETF) from around the world.

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