Correlation Between PLAYMATES TOYS and JAPAN AIRLINES
Can any of the company-specific risk be diversified away by investing in both PLAYMATES TOYS and JAPAN AIRLINES 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 PLAYMATES TOYS and JAPAN AIRLINES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PLAYMATES TOYS and JAPAN AIRLINES, you can compare the effects of market volatilities on PLAYMATES TOYS and JAPAN AIRLINES 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 PLAYMATES TOYS with a short position of JAPAN AIRLINES. Check out your portfolio center. Please also check ongoing floating volatility patterns of PLAYMATES TOYS and JAPAN AIRLINES.
Diversification Opportunities for PLAYMATES TOYS and JAPAN AIRLINES
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between PLAYMATES and JAPAN is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding PLAYMATES TOYS and JAPAN AIRLINES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JAPAN AIRLINES and PLAYMATES TOYS 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 PLAYMATES TOYS are associated (or correlated) with JAPAN AIRLINES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JAPAN AIRLINES has no effect on the direction of PLAYMATES TOYS i.e., PLAYMATES TOYS and JAPAN AIRLINES go up and down completely randomly.
Pair Corralation between PLAYMATES TOYS and JAPAN AIRLINES
Assuming the 90 days trading horizon PLAYMATES TOYS is expected to generate 4.59 times more return on investment than JAPAN AIRLINES. However, PLAYMATES TOYS is 4.59 times more volatile than JAPAN AIRLINES. It trades about 0.08 of its potential returns per unit of risk. JAPAN AIRLINES is currently generating about -0.02 per unit of risk. If you would invest 1.48 in PLAYMATES TOYS on November 1, 2024 and sell it today you would earn a total of 5.02 from holding PLAYMATES TOYS or generate 339.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PLAYMATES TOYS vs. JAPAN AIRLINES
Performance |
| Timeline |
| PLAYMATES TOYS |
| JAPAN AIRLINES |
PLAYMATES TOYS and JAPAN AIRLINES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PLAYMATES TOYS and JAPAN AIRLINES
The main advantage of trading using opposite PLAYMATES TOYS and JAPAN AIRLINES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PLAYMATES TOYS position performs unexpectedly, JAPAN AIRLINES 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 JAPAN AIRLINES will offset losses from the drop in JAPAN AIRLINES's long position.| PLAYMATES TOYS vs. United Natural Foods | PLAYMATES TOYS vs. PREMIER FOODS | PLAYMATES TOYS vs. Hanison Construction Holdings | PLAYMATES TOYS vs. CAL MAINE FOODS |
| JAPAN AIRLINES vs. Easy Software AG | JAPAN AIRLINES vs. Check Point Software | JAPAN AIRLINES vs. MAVEN WIRELESS SWEDEN | JAPAN AIRLINES vs. Micron Technology |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
Other Complementary Tools
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk |