Correlation Between BK Technologies and Jupai Holdings

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

By analyzing existing cross correlation between BK Technologies and Jupai Holdings, you can compare the effects of market volatilities on BK Technologies and Jupai Holdings 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 BK Technologies with a short position of Jupai Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of BK Technologies and Jupai Holdings.

Diversification Opportunities for BK Technologies and Jupai Holdings

0.0

Correlation Coefficient

BK Technologies  Jupai Holdings

Pay attention - limited upside

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

Pair Corralation between BK Technologies and Jupai Holdings

If you would invest  1,131  in BK Technologies on January 31, 2024 and sell it today you would earn a total of  284.00  from holding BK Technologies or generate 25.11% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

BK Technologies  vs.  Jupai Holdings

BK Technologies

Risk-Adjusted Performance

7 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in BK Technologies are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite fairly uncertain basic indicators, BK Technologies demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Jupai Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Jupai Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Jupai Holdings is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with BK Technologies and Jupai Holdings

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

The idea behind BK Technologies and Jupai Holdings 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.