Correlation Between Jensen and Sipef NV
Can any of the company-specific risk be diversified away by investing in both Jensen and Sipef NV 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 Jensen and Sipef NV into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jensen Group and Sipef NV, you can compare the effects of market volatilities on Jensen and Sipef NV 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 Jensen with a short position of Sipef NV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jensen and Sipef NV.
Diversification Opportunities for Jensen and Sipef NV
Good diversification
The 3 months correlation between Jensen and Sipef is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Jensen Group and Sipef NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sipef NV and Jensen 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 Jensen Group are associated (or correlated) with Sipef NV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sipef NV has no effect on the direction of Jensen i.e., Jensen and Sipef NV go up and down completely randomly.
Pair Corralation between Jensen and Sipef NV
Assuming the 90 days trading horizon Jensen Group is expected to generate 1.56 times more return on investment than Sipef NV. However, Jensen is 1.56 times more volatile than Sipef NV. It trades about 0.07 of its potential returns per unit of risk. Sipef NV is currently generating about 0.07 per unit of risk. If you would invest 3,326 in Jensen Group on August 27, 2024 and sell it today you would earn a total of 714.00 from holding Jensen Group or generate 21.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jensen Group vs. Sipef NV
Performance |
| Timeline |
| Jensen Group |
| Sipef NV |
Jensen and Sipef NV Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jensen and Sipef NV
The main advantage of trading using opposite Jensen and Sipef NV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jensen position performs unexpectedly, Sipef NV 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 Sipef NV will offset losses from the drop in Sipef NV's long position.The idea behind Jensen Group and Sipef NV pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Sipef NV vs. Tessenderlo | Sipef NV vs. EVS Broadcast Equipment | Sipef NV vs. Ackermans Van Haaren | Sipef NV vs. Melexis NV |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
Other Complementary Tools
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format |