Correlation Between GEAR4MUSIC and JINS HOLDINGS
Can any of the company-specific risk be diversified away by investing in both GEAR4MUSIC and JINS HOLDINGS 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 GEAR4MUSIC and JINS HOLDINGS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GEAR4MUSIC LS 10 and JINS HOLDINGS INC, you can compare the effects of market volatilities on GEAR4MUSIC and JINS HOLDINGS 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 GEAR4MUSIC with a short position of JINS HOLDINGS. Check out your portfolio center. Please also check ongoing floating volatility patterns of GEAR4MUSIC and JINS HOLDINGS.
Diversification Opportunities for GEAR4MUSIC and JINS HOLDINGS
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GEAR4MUSIC and JINS is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding GEAR4MUSIC LS 10 and JINS HOLDINGS INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JINS HOLDINGS INC and GEAR4MUSIC 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 GEAR4MUSIC LS 10 are associated (or correlated) with JINS HOLDINGS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JINS HOLDINGS INC has no effect on the direction of GEAR4MUSIC i.e., GEAR4MUSIC and JINS HOLDINGS go up and down completely randomly.
Pair Corralation between GEAR4MUSIC and JINS HOLDINGS
Assuming the 90 days horizon GEAR4MUSIC is expected to generate 7.1 times less return on investment than JINS HOLDINGS. But when comparing it to its historical volatility, GEAR4MUSIC LS 10 is 1.17 times less risky than JINS HOLDINGS. It trades about 0.01 of its potential returns per unit of risk. JINS HOLDINGS INC is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 2,620 in JINS HOLDINGS INC on October 25, 2024 and sell it today you would earn a total of 1,320 from holding JINS HOLDINGS INC or generate 50.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GEAR4MUSIC LS 10 vs. JINS HOLDINGS INC
Performance |
| Timeline |
| GEAR4MUSIC LS 10 |
| JINS HOLDINGS INC |
GEAR4MUSIC and JINS HOLDINGS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GEAR4MUSIC and JINS HOLDINGS
The main advantage of trading using opposite GEAR4MUSIC and JINS HOLDINGS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GEAR4MUSIC position performs unexpectedly, JINS HOLDINGS 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 JINS HOLDINGS will offset losses from the drop in JINS HOLDINGS's long position.| GEAR4MUSIC vs. Amazon Inc | GEAR4MUSIC vs. Amazon Inc | GEAR4MUSIC vs. Alibaba Group Holdings | GEAR4MUSIC vs. MEITUAN UNSPADR2B |
| JINS HOLDINGS vs. SBM OFFSHORE | JINS HOLDINGS vs. EMBARK EDUCATION LTD | JINS HOLDINGS vs. EIDESVIK OFFSHORE NK | JINS HOLDINGS vs. Strategic Education |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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