Correlation Between Jat Holdings and Commercial Credit
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By analyzing existing cross correlation between Jat Holdings PLC and Commercial Credit and, you can compare the effects of market volatilities on Jat Holdings and Commercial Credit 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 Jat Holdings with a short position of Commercial Credit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jat Holdings and Commercial Credit.
Diversification Opportunities for Jat Holdings and Commercial Credit
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Jat and Commercial is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Jat Holdings PLC and Commercial Credit and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Commercial Credit and Jat Holdings 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 Jat Holdings PLC are associated (or correlated) with Commercial Credit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Commercial Credit has no effect on the direction of Jat Holdings i.e., Jat Holdings and Commercial Credit go up and down completely randomly.
Pair Corralation between Jat Holdings and Commercial Credit
Assuming the 90 days trading horizon Jat Holdings is expected to generate 2.58 times less return on investment than Commercial Credit. But when comparing it to its historical volatility, Jat Holdings PLC is 1.21 times less risky than Commercial Credit. It trades about 0.04 of its potential returns per unit of risk. Commercial Credit and is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 2,310 in Commercial Credit and on August 31, 2024 and sell it today you would earn a total of 2,200 from holding Commercial Credit and or generate 95.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jat Holdings PLC vs. Commercial Credit and
Performance |
| Timeline |
| Jat Holdings PLC |
| Commercial Credit |
Jat Holdings and Commercial Credit Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jat Holdings and Commercial Credit
The main advantage of trading using opposite Jat Holdings and Commercial Credit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jat Holdings position performs unexpectedly, Commercial Credit 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 Commercial Credit will offset losses from the drop in Commercial Credit's long position.| Jat Holdings vs. RENUKA FOODS PLC | Jat Holdings vs. Lanka Milk Foods | Jat Holdings vs. BROWNS INVESTMENTS PLC | Jat Holdings vs. Kandy Hotels |
| Commercial Credit vs. HNB Finance | Commercial Credit vs. Prime Lands Residencies | Commercial Credit vs. Jat Holdings PLC | Commercial Credit vs. E M L |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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