Correlation Between JLEN Environmental and Universal Health
Can any of the company-specific risk be diversified away by investing in both JLEN Environmental and Universal Health 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 Universal Health 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 Universal Health Services, you can compare the effects of market volatilities on JLEN Environmental and Universal Health 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 Universal Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of JLEN Environmental and Universal Health.
Diversification Opportunities for JLEN Environmental and Universal Health
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between JLEN and Universal is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding JLEN Environmental Assets and Universal Health Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Universal Health Services 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 Universal Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Universal Health Services has no effect on the direction of JLEN Environmental i.e., JLEN Environmental and Universal Health go up and down completely randomly.
Pair Corralation between JLEN Environmental and Universal Health
Assuming the 90 days trading horizon JLEN Environmental Assets is expected to under-perform the Universal Health. But the stock apears to be less risky and, when comparing its historical volatility, JLEN Environmental Assets is 1.43 times less risky than Universal Health. The stock trades about -0.05 of its potential returns per unit of risk. The Universal Health Services is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 14,835 in Universal Health Services on October 13, 2024 and sell it today you would earn a total of 3,644 from holding Universal Health Services or generate 24.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 86.77% |
| Values | Daily Returns |
JLEN Environmental Assets vs. Universal Health Services
Performance |
| Timeline |
| JLEN Environmental Assets |
| Universal Health Services |
JLEN Environmental and Universal Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JLEN Environmental and Universal Health
The main advantage of trading using opposite JLEN Environmental and Universal Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JLEN Environmental position performs unexpectedly, Universal Health 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 Universal Health will offset losses from the drop in Universal Health's long position.| JLEN Environmental vs. Spirent Communications plc | JLEN Environmental vs. XLMedia PLC | JLEN Environmental vs. Atresmedia | JLEN Environmental vs. UNIQA Insurance Group |
| Universal Health vs. Universal Display Corp | Universal Health vs. Thor Mining PLC | Universal Health vs. Wheaton Precious Metals | Universal Health vs. JLEN Environmental Assets |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges |