Correlation Between Jefferies Financial and Apple
Can any of the company-specific risk be diversified away by investing in both Jefferies Financial and Apple 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 Jefferies Financial and Apple into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jefferies Financial Group and Apple Inc, you can compare the effects of market volatilities on Jefferies Financial and Apple 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 Jefferies Financial with a short position of Apple. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jefferies Financial and Apple.
Diversification Opportunities for Jefferies Financial and Apple
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Jefferies and Apple is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Jefferies Financial Group and Apple Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc and Jefferies Financial 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 Jefferies Financial Group are associated (or correlated) with Apple. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apple Inc has no effect on the direction of Jefferies Financial i.e., Jefferies Financial and Apple go up and down completely randomly.
Pair Corralation between Jefferies Financial and Apple
Assuming the 90 days trading horizon Jefferies Financial Group is expected to generate 1.04 times more return on investment than Apple. However, Jefferies Financial is 1.04 times more volatile than Apple Inc. It trades about 0.0 of its potential returns per unit of risk. Apple Inc is currently generating about -0.01 per unit of risk. If you would invest 48,081 in Jefferies Financial Group on October 12, 2024 and sell it today you would lose (123.00) from holding Jefferies Financial Group or give up 0.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jefferies Financial Group vs. Apple Inc
Performance |
| Timeline |
| Jefferies Financial |
| Apple Inc |
Jefferies Financial and Apple Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jefferies Financial and Apple
The main advantage of trading using opposite Jefferies Financial and Apple positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jefferies Financial position performs unexpectedly, Apple 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 Apple will offset losses from the drop in Apple's long position.| Jefferies Financial vs. Pentair plc | Jefferies Financial vs. Tres Tentos Agroindustrial | Jefferies Financial vs. Metalurgica Gerdau SA | Jefferies Financial vs. Brpr Corporate Offices |
| Apple vs. GP Investments | Apple vs. Citizens Financial Group, | Apple vs. Apartment Investment and | Apple vs. Jefferies Financial 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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