Correlation Between JE Cleantech and Nabtesco
Can any of the company-specific risk be diversified away by investing in both JE Cleantech and Nabtesco 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 JE Cleantech and Nabtesco into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JE Cleantech Holdings and Nabtesco, you can compare the effects of market volatilities on JE Cleantech and Nabtesco 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 JE Cleantech with a short position of Nabtesco. Check out your portfolio center. Please also check ongoing floating volatility patterns of JE Cleantech and Nabtesco.
Diversification Opportunities for JE Cleantech and Nabtesco
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between JCSE and Nabtesco is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding JE Cleantech Holdings and Nabtesco in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nabtesco and JE Cleantech 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 JE Cleantech Holdings are associated (or correlated) with Nabtesco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nabtesco has no effect on the direction of JE Cleantech i.e., JE Cleantech and Nabtesco go up and down completely randomly.
Pair Corralation between JE Cleantech and Nabtesco
Given the investment horizon of 90 days JE Cleantech Holdings is expected to generate 1.69 times more return on investment than Nabtesco. However, JE Cleantech is 1.69 times more volatile than Nabtesco. It trades about 0.03 of its potential returns per unit of risk. Nabtesco is currently generating about 0.02 per unit of risk. If you would invest 219.00 in JE Cleantech Holdings on September 24, 2024 and sell it today you would lose (71.00) from holding JE Cleantech Holdings or give up 32.42% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
JE Cleantech Holdings vs. Nabtesco
Performance |
| Timeline |
| JE Cleantech Holdings |
| Nabtesco |
JE Cleantech and Nabtesco Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JE Cleantech and Nabtesco
The main advantage of trading using opposite JE Cleantech and Nabtesco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JE Cleantech position performs unexpectedly, Nabtesco 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 Nabtesco will offset losses from the drop in Nabtesco's long position.| JE Cleantech vs. Nuburu Inc | JE Cleantech vs. Laser Photonics | JE Cleantech vs. Reelcause | JE Cleantech vs. Quality Industrial Corp |
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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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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