Correlation Between Enghouse Systems and Jamieson Wellness
Can any of the company-specific risk be diversified away by investing in both Enghouse Systems and Jamieson Wellness 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 Enghouse Systems and Jamieson Wellness into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Enghouse Systems and Jamieson Wellness, you can compare the effects of market volatilities on Enghouse Systems and Jamieson Wellness 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 Enghouse Systems with a short position of Jamieson Wellness. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enghouse Systems and Jamieson Wellness.
Diversification Opportunities for Enghouse Systems and Jamieson Wellness
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Enghouse and Jamieson is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Enghouse Systems and Jamieson Wellness in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jamieson Wellness and Enghouse Systems 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 Enghouse Systems are associated (or correlated) with Jamieson Wellness. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jamieson Wellness has no effect on the direction of Enghouse Systems i.e., Enghouse Systems and Jamieson Wellness go up and down completely randomly.
Pair Corralation between Enghouse Systems and Jamieson Wellness
Assuming the 90 days trading horizon Enghouse Systems is expected to generate 2.61 times less return on investment than Jamieson Wellness. In addition to that, Enghouse Systems is 1.27 times more volatile than Jamieson Wellness. It trades about 0.01 of its total potential returns per unit of risk. Jamieson Wellness is currently generating about 0.02 per unit of volatility. If you would invest 3,305 in Jamieson Wellness on August 30, 2024 and sell it today you would earn a total of 391.00 from holding Jamieson Wellness or generate 11.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Enghouse Systems vs. Jamieson Wellness
Performance |
| Timeline |
| Enghouse Systems |
| Jamieson Wellness |
Enghouse Systems and Jamieson Wellness Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enghouse Systems and Jamieson Wellness
The main advantage of trading using opposite Enghouse Systems and Jamieson Wellness positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enghouse Systems position performs unexpectedly, Jamieson Wellness 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 Jamieson Wellness will offset losses from the drop in Jamieson Wellness' long position.| Enghouse Systems vs. Kinaxis | Enghouse Systems vs. Open Text Corp | Enghouse Systems vs. Descartes Systems Group | Enghouse Systems vs. Constellation Software |
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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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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