Correlation Between Beyond and JD

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

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

Diversification Opportunities for Beyond and JD

-0.76

Correlation Coefficient

Beyond  JD

Pay attention - limited upside

The 3 months correlation between Beyond and JD is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Beyond Inc and JD Inc Adr in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JD Inc Adr and Beyond 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 Beyond Inc are associated (or correlated) with JD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JD Inc Adr has no effect on the direction of Beyond i.e., Beyond and JD go up and down completely randomly.

Pair Corralation between Beyond and JD

Given the investment horizon of 90 days Beyond Inc is expected to under-perform the JD. In addition to that, Beyond is 3.02 times more volatile than JD Inc Adr. It trades about -0.2 of its total potential returns per unit of risk. JD Inc Adr is currently generating about -0.16 per unit of volatility. If you would invest  3,271  in JD Inc Adr on March 7, 2024 and sell it today you would lose (264.00) from holding JD Inc Adr or give up 8.07% of portfolio value over 90 days.

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

Beyond Inc  vs.  JD Inc Adr

Beyond Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Beyond Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of inconsistent performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in July 2024. The recent disarray may also be a sign of long period up-swing for the firm investors.

JD Inc Adr

Risk-Adjusted Performance

12 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in JD Inc Adr are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of rather inconsistent fundamental indicators, JD exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Beyond and JD

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

The idea behind Beyond Inc and JD Inc Adr 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.