Correlation Between JLEN Environmental and Abingdon Health
Can any of the company-specific risk be diversified away by investing in both JLEN Environmental and Abingdon 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 Abingdon 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 Abingdon Health Plc, you can compare the effects of market volatilities on JLEN Environmental and Abingdon 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 Abingdon Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of JLEN Environmental and Abingdon Health.
Diversification Opportunities for JLEN Environmental and Abingdon Health
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between JLEN and Abingdon is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding JLEN Environmental Assets and Abingdon Health Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Abingdon Health Plc 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 Abingdon Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Abingdon Health Plc has no effect on the direction of JLEN Environmental i.e., JLEN Environmental and Abingdon Health go up and down completely randomly.
Pair Corralation between JLEN Environmental and Abingdon Health
Assuming the 90 days trading horizon JLEN Environmental Assets is expected to under-perform the Abingdon Health. But the stock apears to be less risky and, when comparing its historical volatility, JLEN Environmental Assets is 1.75 times less risky than Abingdon Health. The stock trades about -0.25 of its potential returns per unit of risk. The Abingdon Health Plc is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 775.00 in Abingdon Health Plc on October 29, 2024 and sell it today you would earn a total of 0.00 from holding Abingdon Health Plc or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 98.39% |
| Values | Daily Returns |
JLEN Environmental Assets vs. Abingdon Health Plc
Performance |
| Timeline |
| JLEN Environmental Assets |
| Abingdon Health Plc |
JLEN Environmental and Abingdon Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JLEN Environmental and Abingdon Health
The main advantage of trading using opposite JLEN Environmental and Abingdon Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JLEN Environmental position performs unexpectedly, Abingdon 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 Abingdon Health will offset losses from the drop in Abingdon Health's long position.| JLEN Environmental vs. New Residential Investment | JLEN Environmental vs. Ecclesiastical Insurance Office | JLEN Environmental vs. Norman Broadbent Plc | JLEN Environmental vs. Vietnam Enterprise Investments |
| Abingdon Health vs. Ashtead Technology Holdings | Abingdon Health vs. Learning Technologies Group | Abingdon Health vs. Sabre Insurance Group | Abingdon Health vs. Playtech 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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