Correlation Between JBDI Holdings and RH
Can any of the company-specific risk be diversified away by investing in both JBDI Holdings and RH 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 JBDI Holdings and RH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JBDI Holdings Limited and RH, you can compare the effects of market volatilities on JBDI Holdings and RH 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 JBDI Holdings with a short position of RH. Check out your portfolio center. Please also check ongoing floating volatility patterns of JBDI Holdings and RH.
Diversification Opportunities for JBDI Holdings and RH
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between JBDI and RH is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding JBDI Holdings Limited and RH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RH and JBDI 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 JBDI Holdings Limited are associated (or correlated) with RH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RH has no effect on the direction of JBDI Holdings i.e., JBDI Holdings and RH go up and down completely randomly.
Pair Corralation between JBDI Holdings and RH
Given the investment horizon of 90 days JBDI Holdings Limited is expected to under-perform the RH. In addition to that, JBDI Holdings is 2.85 times more volatile than RH. It trades about -0.16 of its total potential returns per unit of risk. RH is currently generating about 0.05 per unit of volatility. If you would invest 40,827 in RH on November 9, 2024 and sell it today you would earn a total of 700.00 from holding RH or generate 1.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
JBDI Holdings Limited vs. RH
Performance |
| Timeline |
| JBDI Holdings Limited |
| RH |
JBDI Holdings and RH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JBDI Holdings and RH
The main advantage of trading using opposite JBDI Holdings and RH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JBDI Holdings position performs unexpectedly, RH 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 RH will offset losses from the drop in RH's long position.| JBDI Holdings vs. Paranovus Entertainment Technology | JBDI Holdings vs. Ubisoft Entertainment | JBDI Holdings vs. Emerson Radio | JBDI Holdings vs. Canlan Ice Sports |
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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