Correlation Between JLEN Environmental and Southwest Airlines
Can any of the company-specific risk be diversified away by investing in both JLEN Environmental and Southwest Airlines 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 Southwest Airlines 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 Southwest Airlines Co, you can compare the effects of market volatilities on JLEN Environmental and Southwest Airlines 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 Southwest Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of JLEN Environmental and Southwest Airlines.
Diversification Opportunities for JLEN Environmental and Southwest Airlines
-0.87 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between JLEN and Southwest is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding JLEN Environmental Assets and Southwest Airlines Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Southwest Airlines 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 Southwest Airlines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Southwest Airlines has no effect on the direction of JLEN Environmental i.e., JLEN Environmental and Southwest Airlines go up and down completely randomly.
Pair Corralation between JLEN Environmental and Southwest Airlines
Assuming the 90 days trading horizon JLEN Environmental Assets is expected to under-perform the Southwest Airlines. But the stock apears to be less risky and, when comparing its historical volatility, JLEN Environmental Assets is 1.99 times less risky than Southwest Airlines. The stock trades about -0.06 of its potential returns per unit of risk. The Southwest Airlines Co is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 2,850 in Southwest Airlines Co on September 2, 2024 and sell it today you would earn a total of 402.00 from holding Southwest Airlines Co or generate 14.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
JLEN Environmental Assets vs. Southwest Airlines Co
Performance |
| Timeline |
| JLEN Environmental Assets |
| Southwest Airlines |
JLEN Environmental and Southwest Airlines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JLEN Environmental and Southwest Airlines
The main advantage of trading using opposite JLEN Environmental and Southwest Airlines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JLEN Environmental position performs unexpectedly, Southwest Airlines 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 Southwest Airlines will offset losses from the drop in Southwest Airlines' 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 |
| Southwest Airlines vs. Uniper SE | Southwest Airlines vs. Mulberry Group PLC | Southwest Airlines vs. London Security Plc | Southwest Airlines vs. Triad Group PLC |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
Other Complementary Tools
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Stocks Directory Find actively traded stocks across global markets | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules |