Correlation Between JAKKS Pacific and Clarus Corp
Can any of the company-specific risk be diversified away by investing in both JAKKS Pacific and Clarus Corp 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 JAKKS Pacific and Clarus Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JAKKS Pacific and Clarus Corp, you can compare the effects of market volatilities on JAKKS Pacific and Clarus Corp 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 JAKKS Pacific with a short position of Clarus Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of JAKKS Pacific and Clarus Corp.
Diversification Opportunities for JAKKS Pacific and Clarus Corp
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between JAKKS and Clarus is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding JAKKS Pacific and Clarus Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Clarus Corp and JAKKS Pacific 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 JAKKS Pacific are associated (or correlated) with Clarus Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Clarus Corp has no effect on the direction of JAKKS Pacific i.e., JAKKS Pacific and Clarus Corp go up and down completely randomly.
Pair Corralation between JAKKS Pacific and Clarus Corp
Given the investment horizon of 90 days JAKKS Pacific is expected to generate 1.76 times less return on investment than Clarus Corp. In addition to that, JAKKS Pacific is 1.29 times more volatile than Clarus Corp. It trades about 0.09 of its total potential returns per unit of risk. Clarus Corp is currently generating about 0.2 per unit of volatility. If you would invest 409.00 in Clarus Corp on August 28, 2024 and sell it today you would earn a total of 54.00 from holding Clarus Corp or generate 13.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
JAKKS Pacific vs. Clarus Corp
Performance |
| Timeline |
| JAKKS Pacific |
| Clarus Corp |
JAKKS Pacific and Clarus Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JAKKS Pacific and Clarus Corp
The main advantage of trading using opposite JAKKS Pacific and Clarus Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JAKKS Pacific position performs unexpectedly, Clarus Corp 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 Clarus Corp will offset losses from the drop in Clarus Corp's long position.| JAKKS Pacific vs. Escalade Incorporated | JAKKS Pacific vs. Clarus Corp | JAKKS Pacific vs. Six Flags Entertainment | JAKKS Pacific vs. American Outdoor Brands |
| Clarus Corp vs. Vista Outdoor | Clarus Corp vs. Johnson Outdoors | Clarus Corp vs. Escalade Incorporated | Clarus Corp vs. JAKKS Pacific |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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