Correlation Between Boeing and JLM Couture
Can any of the company-specific risk be diversified away by investing in both Boeing and JLM Couture 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 Boeing and JLM Couture into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Boeing and JLM Couture, you can compare the effects of market volatilities on Boeing and JLM Couture 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 Boeing with a short position of JLM Couture. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boeing and JLM Couture.
Diversification Opportunities for Boeing and JLM Couture
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Boeing and JLM is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding The Boeing and JLM Couture in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JLM Couture and Boeing 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 The Boeing are associated (or correlated) with JLM Couture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JLM Couture has no effect on the direction of Boeing i.e., Boeing and JLM Couture go up and down completely randomly.
Pair Corralation between Boeing and JLM Couture
If you would invest 110.00 in JLM Couture on September 3, 2024 and sell it today you would earn a total of 0.00 from holding JLM Couture or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 0.4% |
| Values | Daily Returns |
The Boeing vs. JLM Couture
Performance |
| Timeline |
| Boeing |
| JLM Couture |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Boeing and JLM Couture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boeing and JLM Couture
The main advantage of trading using opposite Boeing and JLM Couture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boeing position performs unexpectedly, JLM Couture 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 JLM Couture will offset losses from the drop in JLM Couture's long position.| Boeing vs. Highway Holdings Limited | Boeing vs. QCR Holdings | Boeing vs. Partner Communications | Boeing vs. Acumen Pharmaceuticals |
| JLM Couture vs. Jerash Holdings | JLM Couture vs. Lakeland Industries | JLM Couture vs. Oxford Industries | JLM Couture vs. G III Apparel 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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