Correlation Between St James’s and Nissan Chemical
Can any of the company-specific risk be diversified away by investing in both St James’s and Nissan Chemical 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 St James’s and Nissan Chemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between St Jamess Place and Nissan Chemical Corp, you can compare the effects of market volatilities on St James’s and Nissan Chemical 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 St James’s with a short position of Nissan Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of St James’s and Nissan Chemical.
Diversification Opportunities for St James’s and Nissan Chemical
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between 1IV and Nissan is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding St Jamess Place and Nissan Chemical Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nissan Chemical Corp and St James’s 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 St Jamess Place are associated (or correlated) with Nissan Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nissan Chemical Corp has no effect on the direction of St James’s i.e., St James’s and Nissan Chemical go up and down completely randomly.
Pair Corralation between St James’s and Nissan Chemical
Assuming the 90 days horizon St Jamess Place is expected to generate 1.48 times more return on investment than Nissan Chemical. However, St James’s is 1.48 times more volatile than Nissan Chemical Corp. It trades about 0.02 of its potential returns per unit of risk. Nissan Chemical Corp is currently generating about -0.03 per unit of risk. If you would invest 1,262 in St Jamess Place on December 4, 2024 and sell it today you would earn a total of 25.00 from holding St Jamess Place or generate 1.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
St Jamess Place vs. Nissan Chemical Corp
Performance |
| Timeline |
| St Jamess Place |
| Nissan Chemical Corp |
St James’s and Nissan Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with St James’s and Nissan Chemical
The main advantage of trading using opposite St James’s and Nissan Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if St James’s position performs unexpectedly, Nissan Chemical 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 Nissan Chemical will offset losses from the drop in Nissan Chemical's long position.| St James’s vs. Ribbon Communications | St James’s vs. Guangdong Investment Limited | St James’s vs. Spirent Communications plc | St James’s vs. ECHO INVESTMENT ZY |
| Nissan Chemical vs. AXWAY SOFTWARE EO | Nissan Chemical vs. Jacquet Metal Service | Nissan Chemical vs. ADRIATIC METALS LS 013355 | Nissan Chemical vs. USU Software AG |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
Other Complementary Tools
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios |