Correlation Between Coastal Capital and JPX Global
Can any of the company-specific risk be diversified away by investing in both Coastal Capital and JPX Global 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 Coastal Capital and JPX Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Coastal Capital Acq and JPX Global, you can compare the effects of market volatilities on Coastal Capital and JPX Global 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 Coastal Capital with a short position of JPX Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coastal Capital and JPX Global.
Diversification Opportunities for Coastal Capital and JPX Global
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Coastal and JPX is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Coastal Capital Acq and JPX Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JPX Global and Coastal Capital 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 Coastal Capital Acq are associated (or correlated) with JPX Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JPX Global has no effect on the direction of Coastal Capital i.e., Coastal Capital and JPX Global go up and down completely randomly.
Pair Corralation between Coastal Capital and JPX Global
Given the investment horizon of 90 days Coastal Capital Acq is expected to generate 1.25 times more return on investment than JPX Global. However, Coastal Capital is 1.25 times more volatile than JPX Global. It trades about 0.1 of its potential returns per unit of risk. JPX Global is currently generating about -0.11 per unit of risk. If you would invest 0.08 in Coastal Capital Acq on October 25, 2024 and sell it today you would lose (0.01) from holding Coastal Capital Acq or give up 12.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.36% |
| Values | Daily Returns |
Coastal Capital Acq vs. JPX Global
Performance |
| Timeline |
| Coastal Capital Acq |
| JPX Global |
Coastal Capital and JPX Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coastal Capital and JPX Global
The main advantage of trading using opposite Coastal Capital and JPX Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coastal Capital position performs unexpectedly, JPX Global 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 JPX Global will offset losses from the drop in JPX Global's long position.| Coastal Capital vs. LiveChain | Coastal Capital vs. CLST Holdings | Coastal Capital vs. Premier Products Group | Coastal Capital vs. Jadeart Group |
| JPX Global vs. Houston Natural Resources | JPX Global vs. Ecosciences | JPX Global vs. Ecoloclean Industrs | JPX Global vs. Garb Oil Pwr |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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