Correlation Between JLEN Environmental and Planet Fitness
Can any of the company-specific risk be diversified away by investing in both JLEN Environmental and Planet Fitness 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 JLEN Environmental and Planet Fitness into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JLEN Environmental Assets and Planet Fitness Cl, you can compare the effects of market volatilities on JLEN Environmental and Planet Fitness 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 JLEN Environmental with a short position of Planet Fitness. Check out your portfolio center. Please also check ongoing floating volatility patterns of JLEN Environmental and Planet Fitness.
Diversification Opportunities for JLEN Environmental and Planet Fitness
-0.8 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between JLEN and Planet is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding JLEN Environmental Assets and Planet Fitness Cl in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Planet Fitness Cl and JLEN Environmental 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 JLEN Environmental Assets are associated (or correlated) with Planet Fitness. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Planet Fitness Cl has no effect on the direction of JLEN Environmental i.e., JLEN Environmental and Planet Fitness go up and down completely randomly.
Pair Corralation between JLEN Environmental and Planet Fitness
Assuming the 90 days trading horizon JLEN Environmental Assets is expected to under-perform the Planet Fitness. But the stock apears to be less risky and, when comparing its historical volatility, JLEN Environmental Assets is 1.85 times less risky than Planet Fitness. The stock trades about -0.24 of its potential returns per unit of risk. The Planet Fitness Cl is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 7,971 in Planet Fitness Cl on September 2, 2024 and sell it today you would earn a total of 2,009 from holding Planet Fitness Cl or generate 25.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 95.38% |
| Values | Daily Returns |
JLEN Environmental Assets vs. Planet Fitness Cl
Performance |
| Timeline |
| JLEN Environmental Assets |
| Planet Fitness Cl |
JLEN Environmental and Planet Fitness Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JLEN Environmental and Planet Fitness
The main advantage of trading using opposite JLEN Environmental and Planet Fitness positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JLEN Environmental position performs unexpectedly, Planet Fitness 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 Planet Fitness will offset losses from the drop in Planet Fitness' long position.| JLEN Environmental vs. Samsung Electronics Co | JLEN Environmental vs. Samsung Electronics Co | JLEN Environmental vs. Toyota Motor Corp | JLEN Environmental vs. Reliance Industries Ltd |
| Planet Fitness vs. Silvercorp Metals | Planet Fitness vs. Future Metals NL | Planet Fitness vs. Sovereign Metals | Planet Fitness vs. Adriatic Metals |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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