Correlation Between Fossil and Jiangsu Expressway
Can any of the company-specific risk be diversified away by investing in both Fossil and Jiangsu Expressway 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 Fossil and Jiangsu Expressway into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fossil Group and Jiangsu Expressway Co, you can compare the effects of market volatilities on Fossil and Jiangsu Expressway 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 Fossil with a short position of Jiangsu Expressway. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fossil and Jiangsu Expressway.
Diversification Opportunities for Fossil and Jiangsu Expressway
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Fossil and Jiangsu is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Fossil Group and Jiangsu Expressway Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangsu Expressway and Fossil 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 Fossil Group are associated (or correlated) with Jiangsu Expressway. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangsu Expressway has no effect on the direction of Fossil i.e., Fossil and Jiangsu Expressway go up and down completely randomly.
Pair Corralation between Fossil and Jiangsu Expressway
Given the investment horizon of 90 days Fossil Group is expected to generate 1.64 times more return on investment than Jiangsu Expressway. However, Fossil is 1.64 times more volatile than Jiangsu Expressway Co. It trades about 0.03 of its potential returns per unit of risk. Jiangsu Expressway Co is currently generating about 0.01 per unit of risk. If you would invest 116.00 in Fossil Group on August 28, 2024 and sell it today you would earn a total of 13.00 from holding Fossil Group or generate 11.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.52% |
| Values | Daily Returns |
Fossil Group vs. Jiangsu Expressway Co
Performance |
| Timeline |
| Fossil Group |
| Jiangsu Expressway |
Fossil and Jiangsu Expressway Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fossil and Jiangsu Expressway
The main advantage of trading using opposite Fossil and Jiangsu Expressway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fossil position performs unexpectedly, Jiangsu Expressway 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 Jiangsu Expressway will offset losses from the drop in Jiangsu Expressway's long position.| Fossil vs. Lanvin Group Holdings | Fossil vs. Signet Jewelers | Fossil vs. Tapestry | Fossil vs. Capri Holdings |
| Jiangsu Expressway vs. Freedom Internet Group | Jiangsu Expressway vs. Plexus Corp | Jiangsu Expressway vs. Weibo Corp | Jiangsu Expressway vs. Casio Computer Co |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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