Correlation Between Jack Henry and High Wire
Can any of the company-specific risk be diversified away by investing in both Jack Henry and High Wire 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 High Wire 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 High Wire Networks, you can compare the effects of market volatilities on Jack Henry and High Wire 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 High Wire. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jack Henry and High Wire.
Diversification Opportunities for Jack Henry and High Wire
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Jack and High is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Jack Henry Associates and High Wire Networks in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on High Wire Networks 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 High Wire. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of High Wire Networks has no effect on the direction of Jack Henry i.e., Jack Henry and High Wire go up and down completely randomly.
Pair Corralation between Jack Henry and High Wire
Given the investment horizon of 90 days Jack Henry Associates is expected to under-perform the High Wire. But the stock apears to be less risky and, when comparing its historical volatility, Jack Henry Associates is 28.28 times less risky than High Wire. The stock trades about -0.19 of its potential returns per unit of risk. The High Wire Networks is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 3.99 in High Wire Networks on September 2, 2024 and sell it today you would earn a total of 1.76 from holding High Wire Networks or generate 44.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jack Henry Associates vs. High Wire Networks
Performance |
| Timeline |
| Jack Henry Associates |
| High Wire Networks |
Jack Henry and High Wire Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jack Henry and High Wire
The main advantage of trading using opposite Jack Henry and High Wire positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jack Henry position performs unexpectedly, High Wire 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 High Wire will offset losses from the drop in High Wire's long position.| Jack Henry vs. CACI International | Jack Henry vs. CDW Corp | Jack Henry vs. Broadridge Financial Solutions | Jack Henry vs. ExlService Holdings |
| High Wire vs. The Travelers Companies | High Wire vs. Walt Disney | High Wire vs. Home Depot | High Wire vs. Procter Gamble |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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