Correlation Between Aspen Aerogels and Janus International
Can any of the company-specific risk be diversified away by investing in both Aspen Aerogels and Janus International 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 Aspen Aerogels and Janus International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aspen Aerogels and Janus International Group, you can compare the effects of market volatilities on Aspen Aerogels and Janus International 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 Aspen Aerogels with a short position of Janus International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aspen Aerogels and Janus International.
Diversification Opportunities for Aspen Aerogels and Janus International
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Aspen and Janus is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Aspen Aerogels and Janus International Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Janus International and Aspen Aerogels 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 Aspen Aerogels are associated (or correlated) with Janus International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Janus International has no effect on the direction of Aspen Aerogels i.e., Aspen Aerogels and Janus International go up and down completely randomly.
Pair Corralation between Aspen Aerogels and Janus International
Given the investment horizon of 90 days Aspen Aerogels is expected to generate 1.36 times more return on investment than Janus International. However, Aspen Aerogels is 1.36 times more volatile than Janus International Group. It trades about -0.09 of its potential returns per unit of risk. Janus International Group is currently generating about -0.13 per unit of risk. If you would invest 2,919 in Aspen Aerogels on August 24, 2024 and sell it today you would lose (1,519) from holding Aspen Aerogels or give up 52.04% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aspen Aerogels vs. Janus International Group
Performance |
| Timeline |
| Aspen Aerogels |
| Janus International |
Aspen Aerogels and Janus International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aspen Aerogels and Janus International
The main advantage of trading using opposite Aspen Aerogels and Janus International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aspen Aerogels position performs unexpectedly, Janus International 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 Janus International will offset losses from the drop in Janus International's long position.| Aspen Aerogels vs. Apyx Medical | Aspen Aerogels vs. Century Communities | Aspen Aerogels vs. Ardmore Shpng | Aspen Aerogels vs. American Assets Trust |
| Janus International vs. Trane Technologies plc | Janus International vs. Masco | Janus International vs. Quanex Building Products | Janus International vs. Jeld Wen Holding |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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