Correlation Between Jeld Wen and BAIYU Holdings
Can any of the company-specific risk be diversified away by investing in both Jeld Wen and BAIYU Holdings 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 Jeld Wen and BAIYU Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jeld Wen Holding and BAIYU Holdings, you can compare the effects of market volatilities on Jeld Wen and BAIYU Holdings 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 Jeld Wen with a short position of BAIYU Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jeld Wen and BAIYU Holdings.
Diversification Opportunities for Jeld Wen and BAIYU Holdings
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Jeld and BAIYU is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Jeld Wen Holding and BAIYU Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BAIYU Holdings and Jeld Wen 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 Jeld Wen Holding are associated (or correlated) with BAIYU Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BAIYU Holdings has no effect on the direction of Jeld Wen i.e., Jeld Wen and BAIYU Holdings go up and down completely randomly.
Pair Corralation between Jeld Wen and BAIYU Holdings
Given the investment horizon of 90 days Jeld Wen Holding is expected to under-perform the BAIYU Holdings. In addition to that, Jeld Wen is 1.79 times more volatile than BAIYU Holdings. It trades about -0.12 of its total potential returns per unit of risk. BAIYU Holdings is currently generating about -0.15 per unit of volatility. If you would invest 20.00 in BAIYU Holdings on September 3, 2024 and sell it today you would lose (2.00) from holding BAIYU Holdings or give up 10.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 70.0% |
| Values | Daily Returns |
Jeld Wen Holding vs. BAIYU Holdings
Performance |
| Timeline |
| Jeld Wen Holding |
| BAIYU Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Jeld Wen and BAIYU Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jeld Wen and BAIYU Holdings
The main advantage of trading using opposite Jeld Wen and BAIYU Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jeld Wen position performs unexpectedly, BAIYU Holdings 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 BAIYU Holdings will offset losses from the drop in BAIYU Holdings' long position.| Jeld Wen vs. Gibraltar Industries | Jeld Wen vs. Quanex Building Products | Jeld Wen vs. Perma Pipe International Holdings | Jeld Wen vs. Interface |
| BAIYU Holdings vs. Jeld Wen Holding | BAIYU Holdings vs. National Beverage Corp | BAIYU Holdings vs. Constellation Brands Class | BAIYU Holdings vs. Willamette Valley Vineyards |
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 CEOs Directory module to screen CEOs from public companies around the world.
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