Correlation Between JAKKS Pacific and Carnival Plc
Can any of the company-specific risk be diversified away by investing in both JAKKS Pacific and Carnival Plc 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 Carnival Plc into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JAKKS Pacific and Carnival Plc ADS, you can compare the effects of market volatilities on JAKKS Pacific and Carnival Plc 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 Carnival Plc. Check out your portfolio center. Please also check ongoing floating volatility patterns of JAKKS Pacific and Carnival Plc.
Diversification Opportunities for JAKKS Pacific and Carnival Plc
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between JAKKS and Carnival is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding JAKKS Pacific and Carnival Plc ADS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carnival Plc ADS 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 Carnival Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carnival Plc ADS has no effect on the direction of JAKKS Pacific i.e., JAKKS Pacific and Carnival Plc go up and down completely randomly.
Pair Corralation between JAKKS Pacific and Carnival Plc
Given the investment horizon of 90 days JAKKS Pacific is expected to generate 1.1 times more return on investment than Carnival Plc. However, JAKKS Pacific is 1.1 times more volatile than Carnival Plc ADS. It trades about 0.1 of its potential returns per unit of risk. Carnival Plc ADS is currently generating about 0.09 per unit of risk. If you would invest 1,814 in JAKKS Pacific on November 28, 2024 and sell it today you would earn a total of 1,069 from holding JAKKS Pacific or generate 58.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
JAKKS Pacific vs. Carnival Plc ADS
Performance |
| Timeline |
| JAKKS Pacific |
| Carnival Plc ADS |
JAKKS Pacific and Carnival Plc Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JAKKS Pacific and Carnival Plc
The main advantage of trading using opposite JAKKS Pacific and Carnival Plc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JAKKS Pacific position performs unexpectedly, Carnival Plc 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 Carnival Plc will offset losses from the drop in Carnival Plc'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 |
| Carnival Plc vs. Callaway Golf | Carnival Plc vs. Peloton Interactive | Carnival Plc vs. Clarus Corp | Carnival Plc vs. Johnson Outdoors |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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