Correlation Between Jeffs Brands and Natural Health
Can any of the company-specific risk be diversified away by investing in both Jeffs Brands and Natural Health 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 Natural Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jeffs Brands and Natural Health Trend, you can compare the effects of market volatilities on Jeffs Brands and Natural Health 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 Natural Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jeffs Brands and Natural Health.
Diversification Opportunities for Jeffs Brands and Natural Health
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Jeffs and Natural is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Jeffs Brands and Natural Health Trend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Natural Health Trend 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 Natural Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Natural Health Trend has no effect on the direction of Jeffs Brands i.e., Jeffs Brands and Natural Health go up and down completely randomly.
Pair Corralation between Jeffs Brands and Natural Health
Given the investment horizon of 90 days Jeffs Brands is expected to under-perform the Natural Health. In addition to that, Jeffs Brands is 1.46 times more volatile than Natural Health Trend. It trades about -0.25 of its total potential returns per unit of risk. Natural Health Trend is currently generating about 0.2 per unit of volatility. If you would invest 464.00 in Natural Health Trend on November 9, 2024 and sell it today you would earn a total of 57.00 from holding Natural Health Trend or generate 12.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jeffs Brands vs. Natural Health Trend
Performance |
| Timeline |
| Jeffs Brands |
| Natural Health Trend |
Jeffs Brands and Natural Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jeffs Brands and Natural Health
The main advantage of trading using opposite Jeffs Brands and Natural Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jeffs Brands position performs unexpectedly, Natural Health 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 Natural Health will offset losses from the drop in Natural Health's long position.| Jeffs Brands vs. Hour Loop | Jeffs Brands vs. Kidpik Corp | Jeffs Brands vs. MOGU Inc | Jeffs Brands vs. Jowell Global |
| Natural Health vs. Liquidity Services | Natural Health vs. Hour Loop | Natural Health vs. Qurate Retail Series | Natural Health vs. Emerge Commerce |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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