Correlation Between Jabil and Benchmark Electronics
Can any of the company-specific risk be diversified away by investing in both Jabil and Benchmark Electronics 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 Jabil and Benchmark Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jabil Inc and Benchmark Electronics, you can compare the effects of market volatilities on Jabil and Benchmark Electronics 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 Jabil with a short position of Benchmark Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jabil and Benchmark Electronics.
Diversification Opportunities for Jabil and Benchmark Electronics
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Jabil and Benchmark is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Jabil Inc and Benchmark Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Benchmark Electronics and Jabil 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 Jabil Inc are associated (or correlated) with Benchmark Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Benchmark Electronics has no effect on the direction of Jabil i.e., Jabil and Benchmark Electronics go up and down completely randomly.
Pair Corralation between Jabil and Benchmark Electronics
Assuming the 90 days horizon Jabil Inc is expected to generate 1.35 times more return on investment than Benchmark Electronics. However, Jabil is 1.35 times more volatile than Benchmark Electronics. It trades about 0.37 of its potential returns per unit of risk. Benchmark Electronics is currently generating about 0.14 per unit of risk. If you would invest 14,035 in Jabil Inc on October 25, 2024 and sell it today you would earn a total of 2,140 from holding Jabil Inc or generate 15.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jabil Inc vs. Benchmark Electronics
Performance |
| Timeline |
| Jabil Inc |
| Benchmark Electronics |
Jabil and Benchmark Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jabil and Benchmark Electronics
The main advantage of trading using opposite Jabil and Benchmark Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jabil position performs unexpectedly, Benchmark Electronics 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 Benchmark Electronics will offset losses from the drop in Benchmark Electronics' long position.| Jabil vs. Playtech plc | Jabil vs. GAZTRTECHNIUADR15EO01 | Jabil vs. Cairo Communication SpA | Jabil vs. Verizon Communications |
| Benchmark Electronics vs. Jabil Inc | Benchmark Electronics vs. KCE EL PCL | Benchmark Electronics vs. TTM Technologies | Benchmark Electronics vs. AT S Austria |
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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