Correlation Between Coty and Juniata Valley
Can any of the company-specific risk be diversified away by investing in both Coty and Juniata Valley 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 Coty and Juniata Valley into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Coty Inc and Juniata Valley Financial, you can compare the effects of market volatilities on Coty and Juniata Valley 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 Coty with a short position of Juniata Valley. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coty and Juniata Valley.
Diversification Opportunities for Coty and Juniata Valley
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Coty and Juniata is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Coty Inc and Juniata Valley Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Juniata Valley Financial and Coty 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 Coty Inc are associated (or correlated) with Juniata Valley. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Juniata Valley Financial has no effect on the direction of Coty i.e., Coty and Juniata Valley go up and down completely randomly.
Pair Corralation between Coty and Juniata Valley
Given the investment horizon of 90 days Coty Inc is expected to generate 1.03 times more return on investment than Juniata Valley. However, Coty is 1.03 times more volatile than Juniata Valley Financial. It trades about 0.2 of its potential returns per unit of risk. Juniata Valley Financial is currently generating about -0.19 per unit of risk. If you would invest 681.00 in Coty Inc on November 4, 2024 and sell it today you would earn a total of 52.00 from holding Coty Inc or generate 7.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Coty Inc vs. Juniata Valley Financial
Performance |
| Timeline |
| Coty Inc |
| Juniata Valley Financial |
Coty and Juniata Valley Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coty and Juniata Valley
The main advantage of trading using opposite Coty and Juniata Valley positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coty position performs unexpectedly, Juniata Valley 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 Juniata Valley will offset losses from the drop in Juniata Valley's long position.The idea behind Coty Inc and Juniata Valley Financial pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Juniata Valley vs. FNB Inc | Juniata Valley vs. Apollo Bancorp | Juniata Valley vs. Commercial National Financial | Juniata Valley vs. Eastern Michigan Financial |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
Other Complementary Tools
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |