Correlation Between JLT Mobile and Anoto Group
Can any of the company-specific risk be diversified away by investing in both JLT Mobile and Anoto Group 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 JLT Mobile and Anoto Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JLT Mobile Computers and Anoto Group AB, you can compare the effects of market volatilities on JLT Mobile and Anoto Group 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 JLT Mobile with a short position of Anoto Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of JLT Mobile and Anoto Group.
Diversification Opportunities for JLT Mobile and Anoto Group
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between JLT and Anoto is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding JLT Mobile Computers and Anoto Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anoto Group AB and JLT Mobile 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 JLT Mobile Computers are associated (or correlated) with Anoto Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anoto Group AB has no effect on the direction of JLT Mobile i.e., JLT Mobile and Anoto Group go up and down completely randomly.
Pair Corralation between JLT Mobile and Anoto Group
Assuming the 90 days trading horizon JLT Mobile Computers is expected to under-perform the Anoto Group. But the stock apears to be less risky and, when comparing its historical volatility, JLT Mobile Computers is 2.52 times less risky than Anoto Group. The stock trades about -0.05 of its potential returns per unit of risk. The Anoto Group AB is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 42.00 in Anoto Group AB on August 29, 2024 and sell it today you would lose (28.00) from holding Anoto Group AB or give up 66.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
JLT Mobile Computers vs. Anoto Group AB
Performance |
| Timeline |
| JLT Mobile Computers |
| Anoto Group AB |
JLT Mobile and Anoto Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JLT Mobile and Anoto Group
The main advantage of trading using opposite JLT Mobile and Anoto Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JLT Mobile position performs unexpectedly, Anoto Group 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 Anoto Group will offset losses from the drop in Anoto Group's long position.| JLT Mobile vs. Anoto Group AB | JLT Mobile vs. Avensia publ AB | JLT Mobile vs. Diadrom Holding AB | JLT Mobile vs. Nepa AB |
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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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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