Correlation Between Jacobs Solutions and Life Insurance
Can any of the company-specific risk be diversified away by investing in both Jacobs Solutions and Life Insurance 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 Life Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jacobs Solutions and Life Insurance, you can compare the effects of market volatilities on Jacobs Solutions and Life Insurance 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 Life Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jacobs Solutions and Life Insurance.
Diversification Opportunities for Jacobs Solutions and Life Insurance
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Jacobs and Life is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Jacobs Solutions and Life Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Life Insurance 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 Life Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Life Insurance has no effect on the direction of Jacobs Solutions i.e., Jacobs Solutions and Life Insurance go up and down completely randomly.
Pair Corralation between Jacobs Solutions and Life Insurance
Taking into account the 90-day investment horizon Jacobs Solutions is expected to generate 0.54 times more return on investment than Life Insurance. However, Jacobs Solutions is 1.85 times less risky than Life Insurance. It trades about 0.05 of its potential returns per unit of risk. Life Insurance is currently generating about -0.08 per unit of risk. If you would invest 9,935 in Jacobs Solutions on September 14, 2024 and sell it today you would earn a total of 3,716 from holding Jacobs Solutions or generate 37.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 64.04% |
| Values | Daily Returns |
Jacobs Solutions vs. Life Insurance
Performance |
| Timeline |
| Jacobs Solutions |
| Life Insurance |
Jacobs Solutions and Life Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jacobs Solutions and Life Insurance
The main advantage of trading using opposite Jacobs Solutions and Life Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jacobs Solutions position performs unexpectedly, Life Insurance 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 Life Insurance will offset losses from the drop in Life Insurance's long position.| Jacobs Solutions vs. KBR Inc | Jacobs Solutions vs. Tetra Tech | Jacobs Solutions vs. Fluor | Jacobs Solutions vs. Topbuild Corp |
| Life Insurance vs. Tandy Leather Factory | Life Insurance vs. Burlington Stores | Life Insurance vs. Inflection Point Acquisition | Life Insurance vs. Jacobs Solutions |
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 CEOs Directory module to screen CEOs from public companies around the world.
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