Correlation Between JLT Mobile and New Nordic
Can any of the company-specific risk be diversified away by investing in both JLT Mobile and New Nordic 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 New Nordic 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 New Nordic Healthbrands, you can compare the effects of market volatilities on JLT Mobile and New Nordic 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 New Nordic. Check out your portfolio center. Please also check ongoing floating volatility patterns of JLT Mobile and New Nordic.
Diversification Opportunities for JLT Mobile and New Nordic
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between JLT and New is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding JLT Mobile Computers and New Nordic Healthbrands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Nordic Healthbrands 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 New Nordic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Nordic Healthbrands has no effect on the direction of JLT Mobile i.e., JLT Mobile and New Nordic go up and down completely randomly.
Pair Corralation between JLT Mobile and New Nordic
Assuming the 90 days trading horizon JLT Mobile Computers is expected to generate 0.86 times more return on investment than New Nordic. However, JLT Mobile Computers is 1.17 times less risky than New Nordic. It trades about -0.19 of its potential returns per unit of risk. New Nordic Healthbrands is currently generating about -0.32 per unit of risk. If you would invest 314.00 in JLT Mobile Computers on August 25, 2024 and sell it today you would lose (28.00) from holding JLT Mobile Computers or give up 8.92% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
JLT Mobile Computers vs. New Nordic Healthbrands
Performance |
| Timeline |
| JLT Mobile Computers |
| New Nordic Healthbrands |
JLT Mobile and New Nordic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JLT Mobile and New Nordic
The main advantage of trading using opposite JLT Mobile and New Nordic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JLT Mobile position performs unexpectedly, New Nordic 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 New Nordic will offset losses from the drop in New Nordic's long position.| JLT Mobile vs. Anoto Group AB | JLT Mobile vs. Avensia publ AB | JLT Mobile vs. Diadrom Holding AB | JLT Mobile vs. Kentima Holding publ |
| New Nordic vs. Stille AB | New Nordic vs. Midsona AB | New Nordic vs. Precio Fishbone AB | New Nordic vs. C Rad 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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