Correlation Between Jacquet Metal and Plastiques
Can any of the company-specific risk be diversified away by investing in both Jacquet Metal and Plastiques 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 Jacquet Metal and Plastiques into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jacquet Metal Service and Plastiques du Val, you can compare the effects of market volatilities on Jacquet Metal and Plastiques 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 Jacquet Metal with a short position of Plastiques. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jacquet Metal and Plastiques.
Diversification Opportunities for Jacquet Metal and Plastiques
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Jacquet and Plastiques is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Jacquet Metal Service and Plastiques du Val in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Plastiques du Val and Jacquet Metal 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 Jacquet Metal Service are associated (or correlated) with Plastiques. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Plastiques du Val has no effect on the direction of Jacquet Metal i.e., Jacquet Metal and Plastiques go up and down completely randomly.
Pair Corralation between Jacquet Metal and Plastiques
Assuming the 90 days trading horizon Jacquet Metal Service is expected to generate 0.72 times more return on investment than Plastiques. However, Jacquet Metal Service is 1.38 times less risky than Plastiques. It trades about 0.01 of its potential returns per unit of risk. Plastiques du Val is currently generating about -0.1 per unit of risk. If you would invest 1,555 in Jacquet Metal Service on August 28, 2024 and sell it today you would earn a total of 35.00 from holding Jacquet Metal Service or generate 2.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jacquet Metal Service vs. Plastiques du Val
Performance |
| Timeline |
| Jacquet Metal Service |
| Plastiques du Val |
Jacquet Metal and Plastiques Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jacquet Metal and Plastiques
The main advantage of trading using opposite Jacquet Metal and Plastiques positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jacquet Metal position performs unexpectedly, Plastiques 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 Plastiques will offset losses from the drop in Plastiques' long position.| Jacquet Metal vs. Prodways Group SA | Jacquet Metal vs. Claranova SE | Jacquet Metal vs. DBV Technologies SA | Jacquet Metal vs. Manitou BF SA |
| Plastiques vs. Groupe Guillin SA | Plastiques vs. Groupe Partouche SA | Plastiques vs. Passat Socit Anonyme | Plastiques vs. Haulotte Group SA |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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