Correlation Between Gulf Energy and Jay Mart
Can any of the company-specific risk be diversified away by investing in both Gulf Energy and Jay Mart 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 Gulf Energy and Jay Mart into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gulf Energy Development and Jay Mart Public, you can compare the effects of market volatilities on Gulf Energy and Jay Mart 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 Gulf Energy with a short position of Jay Mart. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gulf Energy and Jay Mart.
Diversification Opportunities for Gulf Energy and Jay Mart
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Gulf and Jay is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Gulf Energy Development and Jay Mart Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jay Mart Public and Gulf Energy 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 Gulf Energy Development are associated (or correlated) with Jay Mart. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jay Mart Public has no effect on the direction of Gulf Energy i.e., Gulf Energy and Jay Mart go up and down completely randomly.
Pair Corralation between Gulf Energy and Jay Mart
Assuming the 90 days trading horizon Gulf Energy Development is expected to generate 0.39 times more return on investment than Jay Mart. However, Gulf Energy Development is 2.58 times less risky than Jay Mart. It trades about 0.03 of its potential returns per unit of risk. Jay Mart Public is currently generating about -0.04 per unit of risk. If you would invest 5,233 in Gulf Energy Development on August 26, 2024 and sell it today you would earn a total of 1,167 from holding Gulf Energy Development or generate 22.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gulf Energy Development vs. Jay Mart Public
Performance |
| Timeline |
| Gulf Energy Development |
| Jay Mart Public |
Gulf Energy and Jay Mart Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gulf Energy and Jay Mart
The main advantage of trading using opposite Gulf Energy and Jay Mart positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gulf Energy position performs unexpectedly, Jay Mart 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 Jay Mart will offset losses from the drop in Jay Mart's long position.| Gulf Energy vs. WHA Public | Gulf Energy vs. TPI Polene Power | Gulf Energy vs. Bangkok Expressway and | Gulf Energy vs. BGrimm Power Public |
| Jay Mart vs. JMT Network Services | Jay Mart vs. Com7 PCL | Jay Mart vs. KCE Electronics Public | Jay Mart vs. Singer Thailand Public |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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