Correlation Between Jay Mart and Eastern Technical

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Can any of the company-specific risk be diversified away by investing in both Jay Mart and Eastern Technical 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 Jay Mart and Eastern Technical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jay Mart Public and Eastern Technical Engineering, you can compare the effects of market volatilities on Jay Mart and Eastern Technical 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 Jay Mart with a short position of Eastern Technical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jay Mart and Eastern Technical.

Diversification Opportunities for Jay Mart and Eastern Technical

0.63
  Correlation Coefficient

Poor diversification

The 3 months correlation between Jay and Eastern is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Jay Mart Public and Eastern Technical Engineering in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastern Technical and Jay Mart 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 Jay Mart Public are associated (or correlated) with Eastern Technical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastern Technical has no effect on the direction of Jay Mart i.e., Jay Mart and Eastern Technical go up and down completely randomly.

Pair Corralation between Jay Mart and Eastern Technical

Assuming the 90 days trading horizon Jay Mart Public is expected to generate 1.41 times more return on investment than Eastern Technical. However, Jay Mart is 1.41 times more volatile than Eastern Technical Engineering. It trades about 0.11 of its potential returns per unit of risk. Eastern Technical Engineering is currently generating about 0.08 per unit of risk. If you would invest  1,593  in Jay Mart Public on September 2, 2024 and sell it today you would lose (183.00) from holding Jay Mart Public or give up 11.49% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Jay Mart Public  vs.  Eastern Technical Engineering

 Performance 
       Timeline  
Jay Mart Public 

Risk-Adjusted Performance

12 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Jay Mart Public are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Even with relatively conflicting basic indicators, Jay Mart reported solid returns over the last few months and may actually be approaching a breakup point.
Eastern Technical 

Risk-Adjusted Performance

8 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Eastern Technical Engineering are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting technical and fundamental indicators, Eastern Technical disclosed solid returns over the last few months and may actually be approaching a breakup point.

Jay Mart and Eastern Technical Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Jay Mart and Eastern Technical

The main advantage of trading using opposite Jay Mart and Eastern Technical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jay Mart position performs unexpectedly, Eastern Technical 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 Eastern Technical will offset losses from the drop in Eastern Technical's long position.
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The idea behind Jay Mart Public and Eastern Technical Engineering pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.

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