Correlation Between Jewett Cameron and United States
Can any of the company-specific risk be diversified away by investing in both Jewett Cameron and United States 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 Jewett Cameron and United States into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jewett Cameron Trading and United States Steel, you can compare the effects of market volatilities on Jewett Cameron and United States 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 Jewett Cameron with a short position of United States. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jewett Cameron and United States.
Diversification Opportunities for Jewett Cameron and United States
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Jewett and United is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Jewett Cameron Trading and United States Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United States Steel and Jewett Cameron 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 Jewett Cameron Trading are associated (or correlated) with United States. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United States Steel has no effect on the direction of Jewett Cameron i.e., Jewett Cameron and United States go up and down completely randomly.
Pair Corralation between Jewett Cameron and United States
Given the investment horizon of 90 days Jewett Cameron is expected to generate 16.6 times less return on investment than United States. But when comparing it to its historical volatility, Jewett Cameron Trading is 1.16 times less risky than United States. It trades about 0.0 of its potential returns per unit of risk. United States Steel is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 2,632 in United States Steel on August 28, 2024 and sell it today you would earn a total of 1,331 from holding United States Steel or generate 50.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jewett Cameron Trading vs. United States Steel
Performance |
| Timeline |
| Jewett Cameron Trading |
| United States Steel |
Jewett Cameron and United States Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jewett Cameron and United States
The main advantage of trading using opposite Jewett Cameron and United States positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jewett Cameron position performs unexpectedly, United States 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 United States will offset losses from the drop in United States' long position.| Jewett Cameron vs. Steven Madden | Jewett Cameron vs. Eldorado Gold Corp | Jewett Cameron vs. Lincoln Electric Holdings | Jewett Cameron vs. Harmony Gold Mining |
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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