Correlation Between James Alpha and Energy Services
Can any of the company-specific risk be diversified away by investing in both James Alpha and Energy Services 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 James Alpha and Energy Services into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between James Alpha Managed and Energy Services Fund, you can compare the effects of market volatilities on James Alpha and Energy Services 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 James Alpha with a short position of Energy Services. Check out your portfolio center. Please also check ongoing floating volatility patterns of James Alpha and Energy Services.
Diversification Opportunities for James Alpha and Energy Services
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between James and Energy is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding James Alpha Managed and Energy Services Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Energy Services and James Alpha 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 James Alpha Managed are associated (or correlated) with Energy Services. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Energy Services has no effect on the direction of James Alpha i.e., James Alpha and Energy Services go up and down completely randomly.
Pair Corralation between James Alpha and Energy Services
Assuming the 90 days horizon James Alpha Managed is expected to generate 0.24 times more return on investment than Energy Services. However, James Alpha Managed is 4.1 times less risky than Energy Services. It trades about 0.12 of its potential returns per unit of risk. Energy Services Fund is currently generating about 0.0 per unit of risk. If you would invest 978.00 in James Alpha Managed on November 28, 2024 and sell it today you would earn a total of 292.00 from holding James Alpha Managed or generate 29.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
James Alpha Managed vs. Energy Services Fund
Performance |
| Timeline |
| James Alpha Managed |
| Energy Services |
James Alpha and Energy Services Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with James Alpha and Energy Services
The main advantage of trading using opposite James Alpha and Energy Services positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if James Alpha position performs unexpectedly, Energy Services 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 Energy Services will offset losses from the drop in Energy Services' long position.| James Alpha vs. Victory Incore Investment | James Alpha vs. Advent Claymore Convertible | James Alpha vs. Invesco Vertible Securities | James Alpha vs. Putnam Vertible Securities |
| Energy Services vs. Energy Fund Investor | Energy Services vs. Basic Materials Fund | Energy Services vs. Electronics Fund Investor | Energy Services vs. Health Care Fund |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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