Correlation Between Imperial Brands and Jadestone Energy
Can any of the company-specific risk be diversified away by investing in both Imperial Brands and Jadestone Energy 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 Imperial Brands and Jadestone Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Imperial Brands PLC and Jadestone Energy, you can compare the effects of market volatilities on Imperial Brands and Jadestone Energy 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 Imperial Brands with a short position of Jadestone Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Imperial Brands and Jadestone Energy.
Diversification Opportunities for Imperial Brands and Jadestone Energy
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Imperial and Jadestone is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Imperial Brands PLC and Jadestone Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jadestone Energy and Imperial Brands 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 Imperial Brands PLC are associated (or correlated) with Jadestone Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jadestone Energy has no effect on the direction of Imperial Brands i.e., Imperial Brands and Jadestone Energy go up and down completely randomly.
Pair Corralation between Imperial Brands and Jadestone Energy
If you would invest 175,645 in Imperial Brands PLC on November 2, 2024 and sell it today you would earn a total of 93,955 from holding Imperial Brands PLC or generate 53.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Imperial Brands PLC vs. Jadestone Energy
Performance |
| Timeline |
| Imperial Brands PLC |
| Jadestone Energy |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Weak
Imperial Brands and Jadestone Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Imperial Brands and Jadestone Energy
The main advantage of trading using opposite Imperial Brands and Jadestone Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Imperial Brands position performs unexpectedly, Jadestone Energy 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 Jadestone Energy will offset losses from the drop in Jadestone Energy's long position.| Imperial Brands vs. Batm Advanced Communications | Imperial Brands vs. Monks Investment Trust | Imperial Brands vs. EJF Investments | Imperial Brands vs. Cellnex Telecom SA |
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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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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