Correlation Between Jianzhi Education and EPAM Systems

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

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

Diversification Opportunities for Jianzhi Education and EPAM Systems

0.42

Correlation Coefficient

Jianzhi Education  EPAM Systems

Very weak diversification

The 3 months correlation between Jianzhi and EPAM is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Jianzhi Education Technology and EPAM Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EPAM Systems and Jianzhi Education 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 Jianzhi Education Technology are associated (or correlated) with EPAM Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EPAM Systems has no effect on the direction of Jianzhi Education i.e., Jianzhi Education and EPAM Systems go up and down completely randomly.

Pair Corralation between Jianzhi Education and EPAM Systems

Allowing for the 90-day total investment horizon Jianzhi Education Technology is expected to under-perform the EPAM Systems. In addition to that, Jianzhi Education is 3.05 times more volatile than EPAM Systems. It trades about -0.16 of its total potential returns per unit of risk. EPAM Systems is currently generating about 0.29 per unit of volatility. If you would invest  14,776  in EPAM Systems on February 10, 2025 and sell it today you would earn a total of  2,934  from holding EPAM Systems or generate 19.86% return on investment over 90 days.

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

Jianzhi Education Technology  vs.  EPAM Systems

Jianzhi Education

Risk-Adjusted Performance

Very Weak

Over the last 90 days Jianzhi Education Technology has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in June 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

EPAM Systems

Risk-Adjusted Performance

Very Weak

Over the last 90 days EPAM Systems has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in June 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Jianzhi Education and EPAM Systems

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

The idea behind Jianzhi Education Technology and EPAM Systems 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.