Correlation Between International Business and JLM Couture
Can any of the company-specific risk be diversified away by investing in both International Business and JLM Couture 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 International Business and JLM Couture into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between International Business Machines and JLM Couture, you can compare the effects of market volatilities on International Business and JLM Couture 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 International Business with a short position of JLM Couture. Check out your portfolio center. Please also check ongoing floating volatility patterns of International Business and JLM Couture.
Diversification Opportunities for International Business and JLM Couture
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between International and JLM is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding International Business Machine and JLM Couture in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JLM Couture and International Business 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 International Business Machines are associated (or correlated) with JLM Couture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JLM Couture has no effect on the direction of International Business i.e., International Business and JLM Couture go up and down completely randomly.
Pair Corralation between International Business and JLM Couture
If you would invest 20,662 in International Business Machines on September 2, 2024 and sell it today you would earn a total of 2,079 from holding International Business Machines or generate 10.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
International Business Machine vs. JLM Couture
Performance |
| Timeline |
| International Business |
| JLM Couture |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
International Business and JLM Couture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with International Business and JLM Couture
The main advantage of trading using opposite International Business and JLM Couture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if International Business position performs unexpectedly, JLM Couture 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 JLM Couture will offset losses from the drop in JLM Couture's long position.| International Business vs. EPAM Systems | International Business vs. Infosys Ltd ADR | International Business vs. Cognizant Technology Solutions | International Business vs. FiscalNote Holdings |
| JLM Couture vs. Jerash Holdings | JLM Couture vs. Lakeland Industries | JLM Couture vs. Oxford Industries | JLM Couture vs. G III Apparel Group |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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