Correlation Between Jacobs Solutions and Humatech
Can any of the company-specific risk be diversified away by investing in both Jacobs Solutions and Humatech 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 Jacobs Solutions and Humatech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jacobs Solutions and Humatech, you can compare the effects of market volatilities on Jacobs Solutions and Humatech 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 Jacobs Solutions with a short position of Humatech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jacobs Solutions and Humatech.
Diversification Opportunities for Jacobs Solutions and Humatech
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Jacobs and Humatech is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Jacobs Solutions and Humatech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Humatech and Jacobs Solutions 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 Jacobs Solutions are associated (or correlated) with Humatech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Humatech has no effect on the direction of Jacobs Solutions i.e., Jacobs Solutions and Humatech go up and down completely randomly.
Pair Corralation between Jacobs Solutions and Humatech
Taking into account the 90-day investment horizon Jacobs Solutions is expected to under-perform the Humatech. But the stock apears to be less risky and, when comparing its historical volatility, Jacobs Solutions is 112.23 times less risky than Humatech. The stock trades about -0.18 of its potential returns per unit of risk. The Humatech is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 0.01 in Humatech on September 12, 2024 and sell it today you would earn a total of 0.17 from holding Humatech or generate 1700.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Jacobs Solutions vs. Humatech
Performance |
| Timeline |
| Jacobs Solutions |
| Humatech |
Jacobs Solutions and Humatech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jacobs Solutions and Humatech
The main advantage of trading using opposite Jacobs Solutions and Humatech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jacobs Solutions position performs unexpectedly, Humatech 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 Humatech will offset losses from the drop in Humatech's long position.| Jacobs Solutions vs. KBR Inc | Jacobs Solutions vs. Tetra Tech | Jacobs Solutions vs. Fluor | Jacobs Solutions vs. Topbuild Corp |
| Humatech vs. Evolution Mining | Humatech vs. Perseus Mining Limited | Humatech vs. Papaya Growth Opportunity | Humatech vs. Alvarium Tiedemann Holdings |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
Other Complementary Tools
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |