Correlation Between INPOST SA and JOHNSON SVC
Can any of the company-specific risk be diversified away by investing in both INPOST SA and JOHNSON SVC 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 INPOST SA and JOHNSON SVC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between INPOST SA EO and JOHNSON SVC LS 10, you can compare the effects of market volatilities on INPOST SA and JOHNSON SVC 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 INPOST SA with a short position of JOHNSON SVC. Check out your portfolio center. Please also check ongoing floating volatility patterns of INPOST SA and JOHNSON SVC.
Diversification Opportunities for INPOST SA and JOHNSON SVC
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between INPOST and JOHNSON is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding INPOST SA EO and JOHNSON SVC LS 10 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JOHNSON SVC LS and INPOST SA 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 INPOST SA EO are associated (or correlated) with JOHNSON SVC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JOHNSON SVC LS has no effect on the direction of INPOST SA i.e., INPOST SA and JOHNSON SVC go up and down completely randomly.
Pair Corralation between INPOST SA and JOHNSON SVC
Assuming the 90 days horizon INPOST SA EO is expected to generate 0.51 times more return on investment than JOHNSON SVC. However, INPOST SA EO is 1.97 times less risky than JOHNSON SVC. It trades about -0.05 of its potential returns per unit of risk. JOHNSON SVC LS 10 is currently generating about -0.04 per unit of risk. If you would invest 1,696 in INPOST SA EO on November 1, 2024 and sell it today you would lose (127.00) from holding INPOST SA EO or give up 7.49% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
INPOST SA EO vs. JOHNSON SVC LS 10
Performance |
| Timeline |
| INPOST SA EO |
| JOHNSON SVC LS |
INPOST SA and JOHNSON SVC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with INPOST SA and JOHNSON SVC
The main advantage of trading using opposite INPOST SA and JOHNSON SVC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INPOST SA position performs unexpectedly, JOHNSON SVC 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 JOHNSON SVC will offset losses from the drop in JOHNSON SVC's long position.| INPOST SA vs. Elis SA | INPOST SA vs. PARK24 LTD | INPOST SA vs. RELO GROUP INC | INPOST SA vs. Transcontinental |
| JOHNSON SVC vs. INPOST SA EO | JOHNSON SVC vs. Elis SA | JOHNSON SVC vs. PARK24 LTD | JOHNSON SVC vs. RELO GROUP INC |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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