Correlation Between JLT Mobile and Catena Media
Can any of the company-specific risk be diversified away by investing in both JLT Mobile and Catena Media 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 Catena Media 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 Catena Media plc, you can compare the effects of market volatilities on JLT Mobile and Catena Media 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 Catena Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of JLT Mobile and Catena Media.
Diversification Opportunities for JLT Mobile and Catena Media
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between JLT and Catena is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding JLT Mobile Computers and Catena Media plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catena Media plc 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 Catena Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catena Media plc has no effect on the direction of JLT Mobile i.e., JLT Mobile and Catena Media go up and down completely randomly.
Pair Corralation between JLT Mobile and Catena Media
Assuming the 90 days trading horizon JLT Mobile Computers is expected to generate 0.42 times more return on investment than Catena Media. However, JLT Mobile Computers is 2.41 times less risky than Catena Media. It trades about -0.15 of its potential returns per unit of risk. Catena Media plc is currently generating about -0.17 per unit of risk. If you would invest 306.00 in JLT Mobile Computers on September 1, 2024 and sell it today you would lose (22.00) from holding JLT Mobile Computers or give up 7.19% 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. Catena Media plc
Performance |
| Timeline |
| JLT Mobile Computers |
| Catena Media plc |
JLT Mobile and Catena Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JLT Mobile and Catena Media
The main advantage of trading using opposite JLT Mobile and Catena Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JLT Mobile position performs unexpectedly, Catena Media 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 Catena Media will offset losses from the drop in Catena Media's long position.| JLT Mobile vs. Anoto Group AB | JLT Mobile vs. Avensia publ AB | JLT Mobile vs. Mekonomen AB | JLT Mobile vs. Embellence Group AB |
| Catena Media vs. Betsson AB | Catena Media vs. Kambi Group PLC | Catena Media vs. Better Collective | Catena Media vs. Evolution AB |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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