Correlation Between Jeffs Brands and Genuine Parts
Can any of the company-specific risk be diversified away by investing in both Jeffs Brands and Genuine Parts 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 Jeffs Brands and Genuine Parts into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jeffs Brands and Genuine Parts Co, you can compare the effects of market volatilities on Jeffs Brands and Genuine Parts 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 Jeffs Brands with a short position of Genuine Parts. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jeffs Brands and Genuine Parts.
Diversification Opportunities for Jeffs Brands and Genuine Parts
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Jeffs and Genuine is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Jeffs Brands and Genuine Parts Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genuine Parts and Jeffs Brands 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 Jeffs Brands are associated (or correlated) with Genuine Parts. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genuine Parts has no effect on the direction of Jeffs Brands i.e., Jeffs Brands and Genuine Parts go up and down completely randomly.
Pair Corralation between Jeffs Brands and Genuine Parts
Given the investment horizon of 90 days Jeffs Brands is expected to under-perform the Genuine Parts. In addition to that, Jeffs Brands is 6.84 times more volatile than Genuine Parts Co. It trades about -0.09 of its total potential returns per unit of risk. Genuine Parts Co is currently generating about -0.12 per unit of volatility. If you would invest 12,319 in Genuine Parts Co on September 18, 2024 and sell it today you would lose (470.00) from holding Genuine Parts Co or give up 3.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jeffs Brands vs. Genuine Parts Co
Performance |
| Timeline |
| Jeffs Brands |
| Genuine Parts |
Jeffs Brands and Genuine Parts Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jeffs Brands and Genuine Parts
The main advantage of trading using opposite Jeffs Brands and Genuine Parts positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jeffs Brands position performs unexpectedly, Genuine Parts 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 Genuine Parts will offset losses from the drop in Genuine Parts' long position.| Jeffs Brands vs. Twilio Inc | Jeffs Brands vs. Getty Images Holdings | Jeffs Brands vs. Baidu Inc | Jeffs Brands vs. Snap Inc |
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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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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