Correlation Between JLT Mobile and USWE Sports
Can any of the company-specific risk be diversified away by investing in both JLT Mobile and USWE Sports 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 USWE Sports 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 USWE Sports AB, you can compare the effects of market volatilities on JLT Mobile and USWE Sports 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 USWE Sports. Check out your portfolio center. Please also check ongoing floating volatility patterns of JLT Mobile and USWE Sports.
Diversification Opportunities for JLT Mobile and USWE Sports
-0.86 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between JLT and USWE is -0.86. Overlapping area represents the amount of risk that can be diversified away by holding JLT Mobile Computers and USWE Sports AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on USWE Sports 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 USWE Sports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of USWE Sports AB has no effect on the direction of JLT Mobile i.e., JLT Mobile and USWE Sports go up and down completely randomly.
Pair Corralation between JLT Mobile and USWE Sports
Assuming the 90 days trading horizon JLT Mobile Computers is expected to under-perform the USWE Sports. But the stock apears to be less risky and, when comparing its historical volatility, JLT Mobile Computers is 1.49 times less risky than USWE Sports. The stock trades about -0.06 of its potential returns per unit of risk. The USWE Sports AB is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 1,140 in USWE Sports AB on September 3, 2024 and sell it today you would lose (220.00) from holding USWE Sports AB or give up 19.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
JLT Mobile Computers vs. USWE Sports AB
Performance |
| Timeline |
| JLT Mobile Computers |
| USWE Sports AB |
JLT Mobile and USWE Sports Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JLT Mobile and USWE Sports
The main advantage of trading using opposite JLT Mobile and USWE Sports positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JLT Mobile position performs unexpectedly, USWE Sports 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 USWE Sports will offset losses from the drop in USWE Sports' 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 |
| USWE Sports vs. Truecaller AB | USWE Sports vs. Dedicare AB | USWE Sports vs. RVRC Holding AB | USWE Sports vs. AddLife 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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