Correlation Between Jacquet Metal and Future Metals
Can any of the company-specific risk be diversified away by investing in both Jacquet Metal and Future Metals 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 Jacquet Metal and Future Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jacquet Metal Service and Future Metals NL, you can compare the effects of market volatilities on Jacquet Metal and Future Metals 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 Jacquet Metal with a short position of Future Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jacquet Metal and Future Metals.
Diversification Opportunities for Jacquet Metal and Future Metals
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Jacquet and Future is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Jacquet Metal Service and Future Metals NL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Future Metals NL and Jacquet Metal 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 Jacquet Metal Service are associated (or correlated) with Future Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Future Metals NL has no effect on the direction of Jacquet Metal i.e., Jacquet Metal and Future Metals go up and down completely randomly.
Pair Corralation between Jacquet Metal and Future Metals
Assuming the 90 days trading horizon Jacquet Metal Service is expected to generate 0.57 times more return on investment than Future Metals. However, Jacquet Metal Service is 1.77 times less risky than Future Metals. It trades about -0.11 of its potential returns per unit of risk. Future Metals NL is currently generating about -0.41 per unit of risk. If you would invest 1,658 in Jacquet Metal Service on August 28, 2024 and sell it today you would lose (71.00) from holding Jacquet Metal Service or give up 4.28% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Jacquet Metal Service vs. Future Metals NL
Performance |
| Timeline |
| Jacquet Metal Service |
| Future Metals NL |
Jacquet Metal and Future Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jacquet Metal and Future Metals
The main advantage of trading using opposite Jacquet Metal and Future Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jacquet Metal position performs unexpectedly, Future Metals 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 Future Metals will offset losses from the drop in Future Metals' long position.| Jacquet Metal vs. Samsung Electronics Co | Jacquet Metal vs. Samsung Electronics Co | Jacquet Metal vs. Hyundai Motor | Jacquet Metal vs. Toyota Motor Corp |
| Future Metals vs. Givaudan SA | Future Metals vs. Antofagasta PLC | Future Metals vs. Centamin PLC | Future Metals vs. Atalaya Mining |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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