Correlation Between Jeld Wen and First Republic
Can any of the company-specific risk be diversified away by investing in both Jeld Wen and First Republic 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 First Republic 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 First Republic Bank, you can compare the effects of market volatilities on Jeld Wen and First Republic 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 First Republic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jeld Wen and First Republic.
Diversification Opportunities for Jeld Wen and First Republic
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Jeld and First is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Jeld Wen Holding and First Republic Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Republic Bank 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 First Republic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Republic Bank has no effect on the direction of Jeld Wen i.e., Jeld Wen and First Republic go up and down completely randomly.
Pair Corralation between Jeld Wen and First Republic
If you would invest 0.01 in First Republic Bank on August 28, 2024 and sell it today you would earn a total of 0.00 from holding First Republic Bank or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Jeld Wen Holding vs. First Republic Bank
Performance |
| Timeline |
| Jeld Wen Holding |
| First Republic Bank |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Jeld Wen and First Republic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jeld Wen and First Republic
The main advantage of trading using opposite Jeld Wen and First Republic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jeld Wen position performs unexpectedly, First Republic 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 First Republic will offset losses from the drop in First Republic's long position.| Jeld Wen vs. Trex Company | Jeld Wen vs. Gibraltar Industries | Jeld Wen vs. Travis Perkins PLC | Jeld Wen vs. Janus International Group |
| First Republic vs. BJs Restaurants | First Republic vs. MGIC Investment Corp | First Republic vs. GoHealth | First Republic vs. Old Republic 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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