Correlation Between JD and Strabag SE
Can any of the company-specific risk be diversified away by investing in both JD and Strabag SE 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 JD and Strabag SE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JD Inc and Strabag SE, you can compare the effects of market volatilities on JD and Strabag SE 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 JD with a short position of Strabag SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of JD and Strabag SE.
Diversification Opportunities for JD and Strabag SE
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between JD and Strabag is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding JD Inc and Strabag SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Strabag SE and JD 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 JD Inc are associated (or correlated) with Strabag SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Strabag SE has no effect on the direction of JD i.e., JD and Strabag SE go up and down completely randomly.
Pair Corralation between JD and Strabag SE
Assuming the 90 days horizon JD Inc is expected to under-perform the Strabag SE. In addition to that, JD is 1.93 times more volatile than Strabag SE. It trades about -0.21 of its total potential returns per unit of risk. Strabag SE is currently generating about 0.07 per unit of volatility. If you would invest 3,750 in Strabag SE on August 29, 2024 and sell it today you would earn a total of 70.00 from holding Strabag SE or generate 1.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
JD Inc vs. Strabag SE
Performance |
| Timeline |
| JD Inc |
| Strabag SE |
JD and Strabag SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JD and Strabag SE
The main advantage of trading using opposite JD and Strabag SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JD position performs unexpectedly, Strabag SE 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 Strabag SE will offset losses from the drop in Strabag SE's long position.| JD vs. RATH Aktiengesellschaft | JD vs. AT S Austria | JD vs. BAWAG Group AG | JD vs. Semperit Aktiengesellschaft Holding |
| Strabag SE vs. Voestalpine AG | Strabag SE vs. Wienerberger AG | Strabag SE vs. OMV Aktiengesellschaft | Strabag SE vs. Raiffeisen Bank International |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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