Correlation Between JD and Coupang LLC
Can any of the company-specific risk be diversified away by investing in both JD and Coupang LLC 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 JD and Coupang LLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JD Inc Adr and Coupang LLC, you can compare the effects of market volatilities on JD and Coupang LLC 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 JD with a short position of Coupang LLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of JD and Coupang LLC.
Diversification Opportunities for JD and Coupang LLC
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between JD and Coupang is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding JD Inc Adr and Coupang LLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coupang LLC and JD 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 JD Inc Adr are associated (or correlated) with Coupang LLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coupang LLC has no effect on the direction of JD i.e., JD and Coupang LLC go up and down completely randomly.
Pair Corralation between JD and Coupang LLC
Allowing for the 90-day total investment horizon JD Inc Adr is expected to under-perform the Coupang LLC. In addition to that, JD is 1.18 times more volatile than Coupang LLC. It trades about -0.05 of its total potential returns per unit of risk. Coupang LLC is currently generating about 0.01 per unit of volatility. If you would invest 2,845 in Coupang LLC on June 6, 2025 and sell it today you would lose (4.00) from holding Coupang LLC or give up 0.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
JD Inc Adr vs. Coupang LLC
Performance |
| Timeline |
| JD Inc Adr |
| Coupang LLC |
JD and Coupang LLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JD and Coupang LLC
The main advantage of trading using opposite JD and Coupang LLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JD position performs unexpectedly, Coupang LLC 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 Coupang LLC will offset losses from the drop in Coupang LLC's long position.The idea behind JD Inc Adr and Coupang LLC 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.| Coupang LLC vs. MercadoLibre | Coupang LLC vs. PDD Holdings | Coupang LLC vs. JD Inc Adr | Coupang LLC vs. Alibaba Group Holding |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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