Correlation Between Scienjoy Holding and BCE

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

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

Diversification Opportunities for Scienjoy Holding and BCE

0.19

Correlation Coefficient

Scienjoy Holding  BCE

Average diversification

The 3 months correlation between Scienjoy and BCE is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Scienjoy Holding Corp and BCE Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BCE Inc and Scienjoy Holding 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 Scienjoy Holding Corp are associated (or correlated) with BCE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BCE Inc has no effect on the direction of Scienjoy Holding i.e., Scienjoy Holding and BCE go up and down completely randomly.

Pair Corralation between Scienjoy Holding and BCE

Allowing for the 90-day total investment horizon Scienjoy Holding Corp is expected to generate 4.63 times more return on investment than BCE. However, Scienjoy Holding is 4.63 times more volatile than BCE Inc. It trades about 0.24 of its potential returns per unit of risk. BCE Inc is currently generating about 0.06 per unit of risk. If you would invest  94.00  in Scienjoy Holding Corp on March 12, 2024 and sell it today you would earn a total of  17.00  from holding Scienjoy Holding Corp or generate 18.09% return on investment over 90 days.

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

Scienjoy Holding Corp  vs.  BCE Inc

Scienjoy Holding Corp

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Scienjoy Holding Corp are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak forward-looking indicators, Scienjoy Holding revealed solid returns over the last few months and may actually be approaching a breakup point.

BCE Inc

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Scienjoy Holding and BCE

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

The idea behind Scienjoy Holding Corp and BCE Inc 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.