Correlation Between JJill and Evolution Mining
Can any of the company-specific risk be diversified away by investing in both JJill and Evolution Mining 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 Evolution Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JJill Inc and Evolution Mining, you can compare the effects of market volatilities on JJill and Evolution Mining 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 Evolution Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of JJill and Evolution Mining.
Diversification Opportunities for JJill and Evolution Mining
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between JJill and Evolution is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding JJill Inc and Evolution Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Evolution Mining 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 Evolution Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Evolution Mining has no effect on the direction of JJill i.e., JJill and Evolution Mining go up and down completely randomly.
Pair Corralation between JJill and Evolution Mining
Given the investment horizon of 90 days JJill is expected to generate 1.66 times less return on investment than Evolution Mining. But when comparing it to its historical volatility, JJill Inc is 1.57 times less risky than Evolution Mining. It trades about 0.09 of its potential returns per unit of risk. Evolution Mining is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 274.00 in Evolution Mining on September 12, 2024 and sell it today you would earn a total of 52.00 from holding Evolution Mining or generate 18.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
JJill Inc vs. Evolution Mining
Performance |
| Timeline |
| JJill Inc |
| Evolution Mining |
JJill and Evolution Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JJill and Evolution Mining
The main advantage of trading using opposite JJill and Evolution Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JJill position performs unexpectedly, Evolution Mining 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 Evolution Mining will offset losses from the drop in Evolution Mining's long position.The idea behind JJill Inc and Evolution Mining 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.| Evolution Mining vs. Regis Resources | Evolution Mining vs. West African Resources | Evolution Mining vs. Allegiant Gold | Evolution Mining vs. Minaurum Gold |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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