Correlation Between J Long and Ermenegildo Zegna
Can any of the company-specific risk be diversified away by investing in both J Long and Ermenegildo Zegna 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 J Long and Ermenegildo Zegna into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between J Long Group Limited and Ermenegildo Zegna NV, you can compare the effects of market volatilities on J Long and Ermenegildo Zegna 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 J Long with a short position of Ermenegildo Zegna. Check out your portfolio center. Please also check ongoing floating volatility patterns of J Long and Ermenegildo Zegna.
Diversification Opportunities for J Long and Ermenegildo Zegna
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between J Long and Ermenegildo is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding J Long Group Limited and Ermenegildo Zegna NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ermenegildo Zegna and J Long 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 J Long Group Limited are associated (or correlated) with Ermenegildo Zegna. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ermenegildo Zegna has no effect on the direction of J Long i.e., J Long and Ermenegildo Zegna go up and down completely randomly.
Pair Corralation between J Long and Ermenegildo Zegna
Allowing for the 90-day total investment horizon J Long Group Limited is expected to under-perform the Ermenegildo Zegna. In addition to that, J Long is 3.88 times more volatile than Ermenegildo Zegna NV. It trades about -0.21 of its total potential returns per unit of risk. Ermenegildo Zegna NV is currently generating about 0.36 per unit of volatility. If you would invest 729.00 in Ermenegildo Zegna NV on September 12, 2024 and sell it today you would earn a total of 121.00 from holding Ermenegildo Zegna NV or generate 16.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
J Long Group Limited vs. Ermenegildo Zegna NV
Performance |
| Timeline |
| J Long Group |
| Ermenegildo Zegna |
J Long and Ermenegildo Zegna Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with J Long and Ermenegildo Zegna
The main advantage of trading using opposite J Long and Ermenegildo Zegna positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if J Long position performs unexpectedly, Ermenegildo Zegna 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 Ermenegildo Zegna will offset losses from the drop in Ermenegildo Zegna's long position.| J Long vs. Ermenegildo Zegna NV | J Long vs. Columbia Sportswear | J Long vs. Gildan Activewear | J Long vs. G III Apparel Group |
| Ermenegildo Zegna vs. Oxford Industries | Ermenegildo Zegna vs. G III Apparel Group | Ermenegildo Zegna vs. Kontoor Brands | Ermenegildo Zegna vs. Columbia Sportswear |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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