Correlation Between JJill and Asure Software
Can any of the company-specific risk be diversified away by investing in both JJill and Asure Software 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 JJill and Asure Software into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JJill Inc and Asure Software, you can compare the effects of market volatilities on JJill and Asure Software 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 JJill with a short position of Asure Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of JJill and Asure Software.
Diversification Opportunities for JJill and Asure Software
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between JJill and Asure is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding JJill Inc and Asure Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asure Software and JJill 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 JJill Inc are associated (or correlated) with Asure Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asure Software has no effect on the direction of JJill i.e., JJill and Asure Software go up and down completely randomly.
Pair Corralation between JJill and Asure Software
Given the investment horizon of 90 days JJill is expected to generate 4.25 times less return on investment than Asure Software. But when comparing it to its historical volatility, JJill Inc is 1.01 times less risky than Asure Software. It trades about 0.01 of its potential returns per unit of risk. Asure Software is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 842.00 in Asure Software on September 1, 2024 and sell it today you would earn a total of 137.00 from holding Asure Software or generate 16.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
JJill Inc vs. Asure Software
Performance |
| Timeline |
| JJill Inc |
| Asure Software |
JJill and Asure Software Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JJill and Asure Software
The main advantage of trading using opposite JJill and Asure Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JJill position performs unexpectedly, Asure Software 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 Asure Software will offset losses from the drop in Asure Software's long position.The idea behind JJill Inc and Asure Software 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.| Asure Software vs. Alkami Technology | Asure Software vs. Blackbaud | Asure Software vs. Enfusion | Asure Software vs. Clearwater Analytics Holdings |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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