Correlation Between Jacquet Metal and Unite Group
Can any of the company-specific risk be diversified away by investing in both Jacquet Metal and Unite Group 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 Unite Group 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 Unite Group PLC, you can compare the effects of market volatilities on Jacquet Metal and Unite Group 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 Unite Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jacquet Metal and Unite Group.
Diversification Opportunities for Jacquet Metal and Unite Group
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Jacquet and Unite is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Jacquet Metal Service and Unite Group PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Unite Group PLC 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 Unite Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Unite Group PLC has no effect on the direction of Jacquet Metal i.e., Jacquet Metal and Unite Group go up and down completely randomly.
Pair Corralation between Jacquet Metal and Unite Group
Assuming the 90 days trading horizon Jacquet Metal Service is expected to under-perform the Unite Group. In addition to that, Jacquet Metal is 1.57 times more volatile than Unite Group PLC. It trades about -0.06 of its total potential returns per unit of risk. Unite Group PLC is currently generating about -0.06 per unit of volatility. If you would invest 87,150 in Unite Group PLC on September 5, 2024 and sell it today you would lose (1,500) from holding Unite Group PLC or give up 1.72% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jacquet Metal Service vs. Unite Group PLC
Performance |
| Timeline |
| Jacquet Metal Service |
| Unite Group PLC |
Jacquet Metal and Unite Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jacquet Metal and Unite Group
The main advantage of trading using opposite Jacquet Metal and Unite Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jacquet Metal position performs unexpectedly, Unite Group 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 Unite Group will offset losses from the drop in Unite Group's 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 |
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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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