Correlation Between Compagnie Plastic and JIAHUA STORES

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

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

Diversification Opportunities for Compagnie Plastic and JIAHUA STORES

0.0

Correlation Coefficient

Compagnie Plastic  JIAHUA STORES

Pay attention - limited upside

The 3 months correlation between Compagnie and JIAHUA is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Compagnie Plastic Omnium and JIAHUA STORES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JIAHUA STORES and Compagnie Plastic 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 Compagnie Plastic Omnium are associated (or correlated) with JIAHUA STORES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JIAHUA STORES has no effect on the direction of Compagnie Plastic i.e., Compagnie Plastic and JIAHUA STORES go up and down completely randomly.

Pair Corralation between Compagnie Plastic and JIAHUA STORES

If you would invest  851.00  in Compagnie Plastic Omnium on April 23, 2025 and sell it today you would earn a total of  340.00  from holding Compagnie Plastic Omnium or generate 39.95% return on investment over 90 days.

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

Compagnie Plastic Omnium  vs.  JIAHUA STORES

Compagnie Plastic Omnium

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Compagnie Plastic Omnium are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Compagnie Plastic reported solid returns over the last few months and may actually be approaching a breakup point.

JIAHUA STORES

Risk-Adjusted Performance

Very Weak

Over the last 90 days JIAHUA STORES has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, JIAHUA STORES is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Compagnie Plastic and JIAHUA STORES

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

The idea behind Compagnie Plastic Omnium and JIAHUA STORES 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.