Correlation Between JD SPORTS and Axcelis Technologies
Can any of the company-specific risk be diversified away by investing in both JD SPORTS and Axcelis Technologies 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 JD SPORTS and Axcelis Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JD SPORTS FASH and Axcelis Technologies, you can compare the effects of market volatilities on JD SPORTS and Axcelis Technologies 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 JD SPORTS with a short position of Axcelis Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of JD SPORTS and Axcelis Technologies.
Diversification Opportunities for JD SPORTS and Axcelis Technologies
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between 9JD and Axcelis is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding JD SPORTS FASH and Axcelis Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Axcelis Technologies and JD SPORTS 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 JD SPORTS FASH are associated (or correlated) with Axcelis Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Axcelis Technologies has no effect on the direction of JD SPORTS i.e., JD SPORTS and Axcelis Technologies go up and down completely randomly.
Pair Corralation between JD SPORTS and Axcelis Technologies
Assuming the 90 days horizon JD SPORTS FASH is expected to under-perform the Axcelis Technologies. In addition to that, JD SPORTS is 1.45 times more volatile than Axcelis Technologies. It trades about -0.16 of its total potential returns per unit of risk. Axcelis Technologies is currently generating about -0.18 per unit of volatility. If you would invest 7,882 in Axcelis Technologies on September 4, 2024 and sell it today you would lose (952.00) from holding Axcelis Technologies or give up 12.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
JD SPORTS FASH vs. Axcelis Technologies
Performance |
| Timeline |
| JD SPORTS FASH |
| Axcelis Technologies |
JD SPORTS and Axcelis Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JD SPORTS and Axcelis Technologies
The main advantage of trading using opposite JD SPORTS and Axcelis Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JD SPORTS position performs unexpectedly, Axcelis Technologies 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 Axcelis Technologies will offset losses from the drop in Axcelis Technologies' long position.| JD SPORTS vs. ASURE SOFTWARE | JD SPORTS vs. CyberArk Software | JD SPORTS vs. UPDATE SOFTWARE | JD SPORTS vs. Kaiser Aluminum |
| Axcelis Technologies vs. Apple Inc | Axcelis Technologies vs. Apple Inc | Axcelis Technologies vs. Apple Inc | Axcelis Technologies vs. Apple 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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