Correlation Between JLEN Environmental and Sparebank
Can any of the company-specific risk be diversified away by investing in both JLEN Environmental and Sparebank 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 Sparebank 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 Sparebank 1 SR, you can compare the effects of market volatilities on JLEN Environmental and Sparebank 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 Sparebank. Check out your portfolio center. Please also check ongoing floating volatility patterns of JLEN Environmental and Sparebank.
Diversification Opportunities for JLEN Environmental and Sparebank
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between JLEN and Sparebank is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding JLEN Environmental Assets and Sparebank 1 SR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sparebank 1 SR 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 Sparebank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sparebank 1 SR has no effect on the direction of JLEN Environmental i.e., JLEN Environmental and Sparebank go up and down completely randomly.
Pair Corralation between JLEN Environmental and Sparebank
Assuming the 90 days trading horizon JLEN Environmental Assets is expected to generate 1.45 times more return on investment than Sparebank. However, JLEN Environmental is 1.45 times more volatile than Sparebank 1 SR. It trades about 0.27 of its potential returns per unit of risk. Sparebank 1 SR is currently generating about 0.07 per unit of risk. If you would invest 6,600 in JLEN Environmental Assets on November 29, 2024 and sell it today you would earn a total of 540.00 from holding JLEN Environmental Assets or generate 8.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
JLEN Environmental Assets vs. Sparebank 1 SR
Performance |
| Timeline |
| JLEN Environmental Assets |
| Sparebank 1 SR |
JLEN Environmental and Sparebank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JLEN Environmental and Sparebank
The main advantage of trading using opposite JLEN Environmental and Sparebank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JLEN Environmental position performs unexpectedly, Sparebank 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 Sparebank will offset losses from the drop in Sparebank's long position.| JLEN Environmental vs. Target Healthcare REIT | JLEN Environmental vs. Aberdeen Diversified Income | JLEN Environmental vs. CVS Health Corp | JLEN Environmental vs. Universal Health Services |
| Sparebank vs. Cognizant Technology Solutions | Sparebank vs. Bytes Technology | Sparebank vs. First Class Metals | Sparebank vs. Pfeiffer Vacuum Technology |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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