Correlation Between BacTech Environmental and JAN Old
Can any of the company-specific risk be diversified away by investing in both BacTech Environmental and JAN Old 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 BacTech Environmental and JAN Old into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BacTech Environmental and JAN Old, you can compare the effects of market volatilities on BacTech Environmental and JAN Old 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 BacTech Environmental with a short position of JAN Old. Check out your portfolio center. Please also check ongoing floating volatility patterns of BacTech Environmental and JAN Old.
Diversification Opportunities for BacTech Environmental and JAN Old
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between BacTech and JAN is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding BacTech Environmental and JAN Old in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JAN Old and BacTech Environmental 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 BacTech Environmental are associated (or correlated) with JAN Old. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JAN Old has no effect on the direction of BacTech Environmental i.e., BacTech Environmental and JAN Old go up and down completely randomly.
Pair Corralation between BacTech Environmental and JAN Old
Assuming the 90 days horizon BacTech Environmental is expected to generate 3.02 times less return on investment than JAN Old. But when comparing it to its historical volatility, BacTech Environmental is 1.41 times less risky than JAN Old. It trades about 0.03 of its potential returns per unit of risk. JAN Old is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 60.00 in JAN Old on November 3, 2024 and sell it today you would lose (60.00) from holding JAN Old or give up 100.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 43.95% |
| Values | Daily Returns |
BacTech Environmental vs. JAN Old
Performance |
| Timeline |
| BacTech Environmental |
| JAN Old |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
BacTech Environmental and JAN Old Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BacTech Environmental and JAN Old
The main advantage of trading using opposite BacTech Environmental and JAN Old positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BacTech Environmental position performs unexpectedly, JAN Old 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 JAN Old will offset losses from the drop in JAN Old's long position.| BacTech Environmental vs. Agilyx AS | BacTech Environmental vs. EcoPlus | BacTech Environmental vs. BQE Water | BacTech Environmental vs. LiCycle Holdings Corp |
| JAN Old vs. Avalon Holdings | JAN Old vs. LanzaTech Global | JAN Old vs. Ambipar Emergency Response | JAN Old vs. Houston Natural Resources |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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