Correlation Between HIM International and Jetwell Computer
Can any of the company-specific risk be diversified away by investing in both HIM International and Jetwell Computer 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 HIM International and Jetwell Computer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HIM International Music and Jetwell Computer Co, you can compare the effects of market volatilities on HIM International and Jetwell Computer 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 HIM International with a short position of Jetwell Computer. Check out your portfolio center. Please also check ongoing floating volatility patterns of HIM International and Jetwell Computer.
Diversification Opportunities for HIM International and Jetwell Computer
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between HIM and Jetwell is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding HIM International Music and Jetwell Computer Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jetwell Computer and HIM International 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 HIM International Music are associated (or correlated) with Jetwell Computer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jetwell Computer has no effect on the direction of HIM International i.e., HIM International and Jetwell Computer go up and down completely randomly.
Pair Corralation between HIM International and Jetwell Computer
Assuming the 90 days trading horizon HIM International is expected to generate 4.81 times less return on investment than Jetwell Computer. But when comparing it to its historical volatility, HIM International Music is 2.21 times less risky than Jetwell Computer. It trades about 0.03 of its potential returns per unit of risk. Jetwell Computer Co is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 12,900 in Jetwell Computer Co on October 26, 2024 and sell it today you would earn a total of 3,050 from holding Jetwell Computer Co or generate 23.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
HIM International Music vs. Jetwell Computer Co
Performance |
| Timeline |
| HIM International Music |
| Jetwell Computer |
HIM International and Jetwell Computer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HIM International and Jetwell Computer
The main advantage of trading using opposite HIM International and Jetwell Computer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HIM International position performs unexpectedly, Jetwell Computer 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 Jetwell Computer will offset losses from the drop in Jetwell Computer's long position.| HIM International vs. Farglory Land Development | HIM International vs. Kuang Hong Arts | HIM International vs. Sports Gear Co | HIM International vs. Hotai Finance Corp |
| Jetwell Computer vs. Grand Ocean Retail | Jetwell Computer vs. Softstar Entertainment | Jetwell Computer vs. HIM International Music | Jetwell Computer vs. CHC Healthcare Group |
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 Correlations module to find global opportunities by holding instruments from different markets.
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