Correlation Between JETEMA and Sam A
Can any of the company-specific risk be diversified away by investing in both JETEMA and Sam A 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 JETEMA and Sam A into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JETEMA Co and Sam A Pharm Co, you can compare the effects of market volatilities on JETEMA and Sam A 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 JETEMA with a short position of Sam A. Check out your portfolio center. Please also check ongoing floating volatility patterns of JETEMA and Sam A.
Diversification Opportunities for JETEMA and Sam A
Very good diversification
The 3 months correlation between JETEMA and Sam is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding JETEMA Co and Sam A Pharm Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sam A Pharm and JETEMA 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 JETEMA Co are associated (or correlated) with Sam A. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sam A Pharm has no effect on the direction of JETEMA i.e., JETEMA and Sam A go up and down completely randomly.
Pair Corralation between JETEMA and Sam A
Assuming the 90 days trading horizon JETEMA Co is expected to generate 0.6 times more return on investment than Sam A. However, JETEMA Co is 1.67 times less risky than Sam A. It trades about 0.08 of its potential returns per unit of risk. Sam A Pharm Co is currently generating about -0.01 per unit of risk. If you would invest 1,590,000 in JETEMA Co on September 2, 2024 and sell it today you would earn a total of 359,000 from holding JETEMA Co or generate 22.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
JETEMA Co vs. Sam A Pharm Co
Performance |
| Timeline |
| JETEMA |
| Sam A Pharm |
JETEMA and Sam A Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JETEMA and Sam A
The main advantage of trading using opposite JETEMA and Sam A positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JETEMA position performs unexpectedly, Sam A 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 Sam A will offset losses from the drop in Sam A's long position.The idea behind JETEMA Co and Sam A Pharm Co pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Sam A vs. BNK Financial Group | Sam A vs. Jeju Semiconductor Corp | Sam A vs. Green Cross Medical | Sam A vs. Cuckoo Homesys Co |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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