Correlation Between Jahwa Electron and Aju IB
Can any of the company-specific risk be diversified away by investing in both Jahwa Electron and Aju IB 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 Jahwa Electron and Aju IB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jahwa Electron and Aju IB Investment, you can compare the effects of market volatilities on Jahwa Electron and Aju IB 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 Jahwa Electron with a short position of Aju IB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jahwa Electron and Aju IB.
Diversification Opportunities for Jahwa Electron and Aju IB
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Jahwa and Aju is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Jahwa Electron and Aju IB Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aju IB Investment and Jahwa Electron 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 Jahwa Electron are associated (or correlated) with Aju IB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aju IB Investment has no effect on the direction of Jahwa Electron i.e., Jahwa Electron and Aju IB go up and down completely randomly.
Pair Corralation between Jahwa Electron and Aju IB
Assuming the 90 days trading horizon Jahwa Electron is expected to under-perform the Aju IB. But the stock apears to be less risky and, when comparing its historical volatility, Jahwa Electron is 1.35 times less risky than Aju IB. The stock trades about -0.07 of its potential returns per unit of risk. The Aju IB Investment is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 250,890 in Aju IB Investment on November 3, 2024 and sell it today you would lose (14,890) from holding Aju IB Investment or give up 5.93% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jahwa Electron vs. Aju IB Investment
Performance |
| Timeline |
| Jahwa Electron |
| Aju IB Investment |
Jahwa Electron and Aju IB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jahwa Electron and Aju IB
The main advantage of trading using opposite Jahwa Electron and Aju IB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jahwa Electron position performs unexpectedly, Aju IB 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 Aju IB will offset losses from the drop in Aju IB's long position.| Jahwa Electron vs. NICE Information Service | Jahwa Electron vs. Display Tech Co | Jahwa Electron vs. Lotte Rental Co | Jahwa Electron vs. SK Chemicals Co |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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