Correlation Between JLEN Environmental and Zurich Insurance
Can any of the company-specific risk be diversified away by investing in both JLEN Environmental and Zurich Insurance 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 Zurich Insurance 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 Zurich Insurance Group, you can compare the effects of market volatilities on JLEN Environmental and Zurich Insurance 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 Zurich Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of JLEN Environmental and Zurich Insurance.
Diversification Opportunities for JLEN Environmental and Zurich Insurance
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between JLEN and Zurich is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding JLEN Environmental Assets and Zurich Insurance Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zurich Insurance 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 Zurich Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zurich Insurance has no effect on the direction of JLEN Environmental i.e., JLEN Environmental and Zurich Insurance go up and down completely randomly.
Pair Corralation between JLEN Environmental and Zurich Insurance
Assuming the 90 days trading horizon JLEN Environmental Assets is expected to under-perform the Zurich Insurance. In addition to that, JLEN Environmental is 1.65 times more volatile than Zurich Insurance Group. It trades about -0.33 of its total potential returns per unit of risk. Zurich Insurance Group is currently generating about 0.07 per unit of volatility. If you would invest 54,400 in Zurich Insurance Group on November 7, 2024 and sell it today you would earn a total of 820.00 from holding Zurich Insurance Group or generate 1.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
JLEN Environmental Assets vs. Zurich Insurance Group
Performance |
| Timeline |
| JLEN Environmental Assets |
| Zurich Insurance |
JLEN Environmental and Zurich Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JLEN Environmental and Zurich Insurance
The main advantage of trading using opposite JLEN Environmental and Zurich Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JLEN Environmental position performs unexpectedly, Zurich Insurance 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 Zurich Insurance will offset losses from the drop in Zurich Insurance's long position.| JLEN Environmental vs. Golden Metal Resources | JLEN Environmental vs. Gamma Communications PLC | JLEN Environmental vs. URU Metals | JLEN Environmental vs. Aeorema Communications Plc |
| Zurich Insurance vs. European Metals Holdings | Zurich Insurance vs. Aberdeen Diversified Income | Zurich Insurance vs. Spire Healthcare Group | Zurich Insurance vs. Ruffer Investment |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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