Correlation Between Jabil Circuit and CapitaLand Investment
Can any of the company-specific risk be diversified away by investing in both Jabil Circuit and CapitaLand Investment 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 Circuit and CapitaLand Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jabil Circuit and CapitaLand Investment Limited, you can compare the effects of market volatilities on Jabil Circuit and CapitaLand Investment 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 Circuit with a short position of CapitaLand Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jabil Circuit and CapitaLand Investment.
Diversification Opportunities for Jabil Circuit and CapitaLand Investment
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Jabil and CapitaLand is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Jabil Circuit and CapitaLand Investment Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CapitaLand Investment and Jabil Circuit 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 Circuit are associated (or correlated) with CapitaLand Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CapitaLand Investment has no effect on the direction of Jabil Circuit i.e., Jabil Circuit and CapitaLand Investment go up and down completely randomly.
Pair Corralation between Jabil Circuit and CapitaLand Investment
Considering the 90-day investment horizon Jabil Circuit is expected to generate 1.05 times more return on investment than CapitaLand Investment. However, Jabil Circuit is 1.05 times more volatile than CapitaLand Investment Limited. It trades about 0.15 of its potential returns per unit of risk. CapitaLand Investment Limited is currently generating about -0.21 per unit of risk. If you would invest 12,471 in Jabil Circuit on August 29, 2024 and sell it today you would earn a total of 801.00 from holding Jabil Circuit or generate 6.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jabil Circuit vs. CapitaLand Investment Limited
Performance |
| Timeline |
| Jabil Circuit |
| CapitaLand Investment |
Jabil Circuit and CapitaLand Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jabil Circuit and CapitaLand Investment
The main advantage of trading using opposite Jabil Circuit and CapitaLand Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jabil Circuit position performs unexpectedly, CapitaLand Investment 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 CapitaLand Investment will offset losses from the drop in CapitaLand Investment's long position.| Jabil Circuit vs. Sanmina | Jabil Circuit vs. Celestica | Jabil Circuit vs. Plexus Corp | Jabil Circuit vs. Fabrinet |
| CapitaLand Investment vs. IRSA Inversiones Y | CapitaLand Investment vs. Anywhere Real Estate | CapitaLand Investment vs. Newmark Group | CapitaLand Investment vs. New York City |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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