Correlation Between ChipsMedia and Jb Financial
Can any of the company-specific risk be diversified away by investing in both ChipsMedia and Jb Financial 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 ChipsMedia and Jb Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ChipsMedia and Jb Financial, you can compare the effects of market volatilities on ChipsMedia and Jb Financial 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 ChipsMedia with a short position of Jb Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of ChipsMedia and Jb Financial.
Diversification Opportunities for ChipsMedia and Jb Financial
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between ChipsMedia and 175330 is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding ChipsMedia and Jb Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jb Financial and ChipsMedia 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 ChipsMedia are associated (or correlated) with Jb Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jb Financial has no effect on the direction of ChipsMedia i.e., ChipsMedia and Jb Financial go up and down completely randomly.
Pair Corralation between ChipsMedia and Jb Financial
Assuming the 90 days trading horizon ChipsMedia is expected to generate 2.19 times more return on investment than Jb Financial. However, ChipsMedia is 2.19 times more volatile than Jb Financial. It trades about 0.05 of its potential returns per unit of risk. Jb Financial is currently generating about 0.06 per unit of risk. If you would invest 795,050 in ChipsMedia on October 12, 2024 and sell it today you would earn a total of 841,950 from holding ChipsMedia or generate 105.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ChipsMedia vs. Jb Financial
Performance |
| Timeline |
| ChipsMedia |
| Jb Financial |
ChipsMedia and Jb Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ChipsMedia and Jb Financial
The main advantage of trading using opposite ChipsMedia and Jb Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ChipsMedia position performs unexpectedly, Jb Financial 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 Jb Financial will offset losses from the drop in Jb Financial's long position.| ChipsMedia vs. MediaZen | ChipsMedia vs. Samlip General Foods | ChipsMedia vs. Digital Multimedia Technology | ChipsMedia vs. Samyang Foods Co |
| Jb Financial vs. ChipsMedia | Jb Financial vs. Alton Sports CoLtd | Jb Financial vs. Kukil Metal Co | Jb Financial vs. MediaZen |
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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