Correlation Between Jacquet Metal and CSL
Can any of the company-specific risk be diversified away by investing in both Jacquet Metal and CSL 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 Jacquet Metal and CSL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jacquet Metal Service and CSL Limited, you can compare the effects of market volatilities on Jacquet Metal and CSL 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 Jacquet Metal with a short position of CSL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jacquet Metal and CSL.
Diversification Opportunities for Jacquet Metal and CSL
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Jacquet and CSL is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Jacquet Metal Service and CSL Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CSL Limited and Jacquet Metal 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 Jacquet Metal Service are associated (or correlated) with CSL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CSL Limited has no effect on the direction of Jacquet Metal i.e., Jacquet Metal and CSL go up and down completely randomly.
Pair Corralation between Jacquet Metal and CSL
Assuming the 90 days horizon Jacquet Metal Service is expected to generate 1.27 times more return on investment than CSL. However, Jacquet Metal is 1.27 times more volatile than CSL Limited. It trades about 0.02 of its potential returns per unit of risk. CSL Limited is currently generating about 0.0 per unit of risk. If you would invest 1,489 in Jacquet Metal Service on September 13, 2024 and sell it today you would earn a total of 153.00 from holding Jacquet Metal Service or generate 10.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jacquet Metal Service vs. CSL Limited
Performance |
| Timeline |
| Jacquet Metal Service |
| CSL Limited |
Jacquet Metal and CSL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jacquet Metal and CSL
The main advantage of trading using opposite Jacquet Metal and CSL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jacquet Metal position performs unexpectedly, CSL 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 CSL will offset losses from the drop in CSL's long position.| Jacquet Metal vs. ArcelorMittal | Jacquet Metal vs. NIPPON STEEL SPADR | Jacquet Metal vs. Reliance Steel Aluminum | Jacquet Metal vs. Superior Plus Corp |
| CSL vs. Jacquet Metal Service | CSL vs. SLR Investment Corp | CSL vs. Virtus Investment Partners | CSL vs. Apollo Investment Corp |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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