Correlation Between Jefferies Financial and So Martinho
Can any of the company-specific risk be diversified away by investing in both Jefferies Financial and So Martinho 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 So Martinho 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 So Martinho SA, you can compare the effects of market volatilities on Jefferies Financial and So Martinho 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 So Martinho. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jefferies Financial and So Martinho.
Diversification Opportunities for Jefferies Financial and So Martinho
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Jefferies and SMTO3 is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Jefferies Financial Group and So Martinho SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on So Martinho SA 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 So Martinho. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of So Martinho SA has no effect on the direction of Jefferies Financial i.e., Jefferies Financial and So Martinho go up and down completely randomly.
Pair Corralation between Jefferies Financial and So Martinho
Assuming the 90 days trading horizon Jefferies Financial Group is expected to generate 1.33 times more return on investment than So Martinho. However, Jefferies Financial is 1.33 times more volatile than So Martinho SA. It trades about 0.13 of its potential returns per unit of risk. So Martinho SA is currently generating about -0.01 per unit of risk. If you would invest 18,840 in Jefferies Financial Group on November 9, 2024 and sell it today you would earn a total of 24,930 from holding Jefferies Financial Group or generate 132.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jefferies Financial Group vs. So Martinho SA
Performance |
| Timeline |
| Jefferies Financial |
| So Martinho SA |
Jefferies Financial and So Martinho Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jefferies Financial and So Martinho
The main advantage of trading using opposite Jefferies Financial and So Martinho positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jefferies Financial position performs unexpectedly, So Martinho 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 So Martinho will offset losses from the drop in So Martinho's long position.| Jefferies Financial vs. Broadridge Financial Solutions, | Jefferies Financial vs. Take Two Interactive Software | Jefferies Financial vs. MAHLE Metal Leve | Jefferies Financial vs. STAG Industrial, |
| So Martinho vs. SLC Agrcola SA | So Martinho vs. Cosan SA | So Martinho vs. Minerva SA | So Martinho vs. Randon SA Implementos |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges |