Correlation Between United Parcel and Jardine Matheson
Can any of the company-specific risk be diversified away by investing in both United Parcel and Jardine Matheson 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 United Parcel and Jardine Matheson into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United Parcel Service and Jardine Matheson Holdings, you can compare the effects of market volatilities on United Parcel and Jardine Matheson 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 United Parcel with a short position of Jardine Matheson. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Parcel and Jardine Matheson.
Diversification Opportunities for United Parcel and Jardine Matheson
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between United and Jardine is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding United Parcel Service and Jardine Matheson Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jardine Matheson Holdings and United Parcel 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 United Parcel Service are associated (or correlated) with Jardine Matheson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jardine Matheson Holdings has no effect on the direction of United Parcel i.e., United Parcel and Jardine Matheson go up and down completely randomly.
Pair Corralation between United Parcel and Jardine Matheson
Assuming the 90 days trading horizon United Parcel Service is expected to under-perform the Jardine Matheson. In addition to that, United Parcel is 10.13 times more volatile than Jardine Matheson Holdings. It trades about -0.02 of its total potential returns per unit of risk. Jardine Matheson Holdings is currently generating about 0.08 per unit of volatility. If you would invest 5,969 in Jardine Matheson Holdings on August 30, 2024 and sell it today you would earn a total of 281.00 from holding Jardine Matheson Holdings or generate 4.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 98.74% |
| Values | Daily Returns |
United Parcel Service vs. Jardine Matheson Holdings
Performance |
| Timeline |
| United Parcel Service |
| Jardine Matheson Holdings |
United Parcel and Jardine Matheson Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Parcel and Jardine Matheson
The main advantage of trading using opposite United Parcel and Jardine Matheson positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Parcel position performs unexpectedly, Jardine Matheson 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 Jardine Matheson will offset losses from the drop in Jardine Matheson's long position.| United Parcel vs. Charter Communications Cl | United Parcel vs. Worldwide Healthcare Trust | United Parcel vs. Target Healthcare REIT | United Parcel vs. Primary Health Properties |
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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 CEOs Directory module to screen CEOs from public companies around the world.
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