Correlation Between Janus International and Aspen Aerogels
Can any of the company-specific risk be diversified away by investing in both Janus International and Aspen Aerogels 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 Janus International and Aspen Aerogels into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Janus International Group and Aspen Aerogels, you can compare the effects of market volatilities on Janus International and Aspen Aerogels 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 Janus International with a short position of Aspen Aerogels. Check out your portfolio center. Please also check ongoing floating volatility patterns of Janus International and Aspen Aerogels.
Diversification Opportunities for Janus International and Aspen Aerogels
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Janus and Aspen is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Janus International Group and Aspen Aerogels in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aspen Aerogels and Janus International 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 Janus International Group are associated (or correlated) with Aspen Aerogels. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aspen Aerogels has no effect on the direction of Janus International i.e., Janus International and Aspen Aerogels go up and down completely randomly.
Pair Corralation between Janus International and Aspen Aerogels
Considering the 90-day investment horizon Janus International Group is expected to under-perform the Aspen Aerogels. But the stock apears to be less risky and, when comparing its historical volatility, Janus International Group is 1.94 times less risky than Aspen Aerogels. The stock trades about -0.09 of its potential returns per unit of risk. The Aspen Aerogels is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 1,718 in Aspen Aerogels on August 27, 2024 and sell it today you would lose (287.00) from holding Aspen Aerogels or give up 16.71% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Janus International Group vs. Aspen Aerogels
Performance |
| Timeline |
| Janus International |
| Aspen Aerogels |
Janus International and Aspen Aerogels Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Janus International and Aspen Aerogels
The main advantage of trading using opposite Janus International and Aspen Aerogels positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Janus International position performs unexpectedly, Aspen Aerogels 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 Aspen Aerogels will offset losses from the drop in Aspen Aerogels' long position.| Janus International vs. Quanex Building Products | Janus International vs. Interface | Janus International vs. Apogee Enterprises | Janus International vs. Gibraltar Industries |
| Aspen Aerogels vs. Apyx Medical | Aspen Aerogels vs. Century Communities | Aspen Aerogels vs. Ardmore Shpng | Aspen Aerogels vs. American Assets Trust |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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