Correlation Between Jacob Finance and Libra Insurance
Can any of the company-specific risk be diversified away by investing in both Jacob Finance and Libra Insurance 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 Jacob Finance and Libra Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jacob Finance And and Libra Insurance, you can compare the effects of market volatilities on Jacob Finance and Libra Insurance 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 Jacob Finance with a short position of Libra Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jacob Finance and Libra Insurance.
Diversification Opportunities for Jacob Finance and Libra Insurance
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Jacob and Libra is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Jacob Finance And and Libra Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Libra Insurance and Jacob Finance 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 Jacob Finance And are associated (or correlated) with Libra Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Libra Insurance has no effect on the direction of Jacob Finance i.e., Jacob Finance and Libra Insurance go up and down completely randomly.
Pair Corralation between Jacob Finance and Libra Insurance
Assuming the 90 days trading horizon Jacob Finance And is expected to under-perform the Libra Insurance. But the stock apears to be less risky and, when comparing its historical volatility, Jacob Finance And is 1.29 times less risky than Libra Insurance. The stock trades about -0.04 of its potential returns per unit of risk. The Libra Insurance is currently generating about 0.36 of returns per unit of risk over similar time horizon. If you would invest 72,004 in Libra Insurance on September 1, 2024 and sell it today you would earn a total of 15,286 from holding Libra Insurance or generate 21.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jacob Finance And vs. Libra Insurance
Performance |
| Timeline |
| Jacob Finance And |
| Libra Insurance |
Jacob Finance and Libra Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jacob Finance and Libra Insurance
The main advantage of trading using opposite Jacob Finance and Libra Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jacob Finance position performs unexpectedly, Libra Insurance 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 Libra Insurance will offset losses from the drop in Libra Insurance's long position.| Jacob Finance vs. Multi Retail Group | Jacob Finance vs. Meitav Trade Inv | Jacob Finance vs. Magic Software Enterprises | Jacob Finance vs. Bank Leumi Le Israel |
| Libra Insurance vs. Brainsway | Libra Insurance vs. Mivne Real Estate | Libra Insurance vs. Photomyne | Libra Insurance vs. Israel Land Development |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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