Correlation Between Jack Henry and Fidelity National
Can any of the company-specific risk be diversified away by investing in both Jack Henry and Fidelity National 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 Jack Henry and Fidelity National into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jack Henry Associates and Fidelity National Information, you can compare the effects of market volatilities on Jack Henry and Fidelity National 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 Jack Henry with a short position of Fidelity National. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jack Henry and Fidelity National.
Diversification Opportunities for Jack Henry and Fidelity National
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Jack and Fidelity is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Jack Henry Associates and Fidelity National Information in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity National and Jack Henry 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 Jack Henry Associates are associated (or correlated) with Fidelity National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity National has no effect on the direction of Jack Henry i.e., Jack Henry and Fidelity National go up and down completely randomly.
Pair Corralation between Jack Henry and Fidelity National
Given the investment horizon of 90 days Jack Henry is expected to generate 2.08 times less return on investment than Fidelity National. But when comparing it to its historical volatility, Jack Henry Associates is 1.02 times less risky than Fidelity National. It trades about 0.05 of its potential returns per unit of risk. Fidelity National Information is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 7,445 in Fidelity National Information on August 24, 2024 and sell it today you would earn a total of 1,105 from holding Fidelity National Information or generate 14.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jack Henry Associates vs. Fidelity National Information
Performance |
| Timeline |
| Jack Henry Associates |
| Fidelity National |
Jack Henry and Fidelity National Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jack Henry and Fidelity National
The main advantage of trading using opposite Jack Henry and Fidelity National positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jack Henry position performs unexpectedly, Fidelity National 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 Fidelity National will offset losses from the drop in Fidelity National's long position.| Jack Henry vs. CACI International | Jack Henry vs. CDW Corp | Jack Henry vs. Broadridge Financial Solutions | Jack Henry vs. ExlService Holdings |
| Fidelity National vs. Jack Henry Associates | Fidelity National vs. Cognizant Technology Solutions | Fidelity National vs. CDW Corp | Fidelity National vs. Gartner |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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