Correlation Between Brookfield Investments and Jade Leader
Can any of the company-specific risk be diversified away by investing in both Brookfield Investments and Jade Leader 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 Brookfield Investments and Jade Leader into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Brookfield Investments and Jade Leader Corp, you can compare the effects of market volatilities on Brookfield Investments and Jade Leader 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 Brookfield Investments with a short position of Jade Leader. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brookfield Investments and Jade Leader.
Diversification Opportunities for Brookfield Investments and Jade Leader
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Brookfield and Jade is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Brookfield Investments and Jade Leader Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jade Leader Corp and Brookfield Investments 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 Brookfield Investments are associated (or correlated) with Jade Leader. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jade Leader Corp has no effect on the direction of Brookfield Investments i.e., Brookfield Investments and Jade Leader go up and down completely randomly.
Pair Corralation between Brookfield Investments and Jade Leader
Assuming the 90 days trading horizon Brookfield Investments is expected to generate 0.07 times more return on investment than Jade Leader. However, Brookfield Investments is 13.72 times less risky than Jade Leader. It trades about 0.02 of its potential returns per unit of risk. Jade Leader Corp is currently generating about -0.06 per unit of risk. If you would invest 2,500 in Brookfield Investments on September 3, 2024 and sell it today you would earn a total of 13.00 from holding Brookfield Investments or generate 0.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 51.2% |
| Values | Daily Returns |
Brookfield Investments vs. Jade Leader Corp
Performance |
| Timeline |
| Brookfield Investments |
| Jade Leader Corp |
Brookfield Investments and Jade Leader Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Brookfield Investments and Jade Leader
The main advantage of trading using opposite Brookfield Investments and Jade Leader positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brookfield Investments position performs unexpectedly, Jade Leader 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 Jade Leader will offset losses from the drop in Jade Leader's long position.| Brookfield Investments vs. Apple Inc CDR | Brookfield Investments vs. NVIDIA CDR | Brookfield Investments vs. Microsoft Corp CDR | Brookfield Investments vs. Amazon CDR |
| Jade Leader vs. Algoma Steel Group | Jade Leader vs. Champion Iron | Jade Leader vs. International Zeolite Corp | Jade Leader vs. European Residential Real |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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