Correlation Between Dana and Jutal Offshore
Can any of the company-specific risk be diversified away by investing in both Dana and Jutal Offshore 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 Dana and Jutal Offshore into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dana Inc and Jutal Offshore Oil, you can compare the effects of market volatilities on Dana and Jutal Offshore 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 Dana with a short position of Jutal Offshore. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dana and Jutal Offshore.
Diversification Opportunities for Dana and Jutal Offshore
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Dana and Jutal is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Dana Inc and Jutal Offshore Oil in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jutal Offshore Oil and Dana 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 Dana Inc are associated (or correlated) with Jutal Offshore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jutal Offshore Oil has no effect on the direction of Dana i.e., Dana and Jutal Offshore go up and down completely randomly.
Pair Corralation between Dana and Jutal Offshore
Considering the 90-day investment horizon Dana Inc is expected to under-perform the Jutal Offshore. But the stock apears to be less risky and, when comparing its historical volatility, Dana Inc is 1.23 times less risky than Jutal Offshore. The stock trades about -0.02 of its potential returns per unit of risk. The Jutal Offshore Oil is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 2,332 in Jutal Offshore Oil on August 30, 2024 and sell it today you would lose (422.00) from holding Jutal Offshore Oil or give up 18.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dana Inc vs. Jutal Offshore Oil
Performance |
| Timeline |
| Dana Inc |
| Jutal Offshore Oil |
Dana and Jutal Offshore Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dana and Jutal Offshore
The main advantage of trading using opposite Dana and Jutal Offshore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dana position performs unexpectedly, Jutal Offshore 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 Jutal Offshore will offset losses from the drop in Jutal Offshore's long position.The idea behind Dana Inc and Jutal Offshore Oil 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.| Jutal Offshore vs. Expro Group Holdings | Jutal Offshore vs. ChampionX | Jutal Offshore vs. Ranger Energy Services | Jutal Offshore vs. Cactus Inc |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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