Correlation Between JM Financial and Swan Energy
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By analyzing existing cross correlation between JM Financial Limited and Swan Energy Limited, you can compare the effects of market volatilities on JM Financial and Swan Energy 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 JM Financial with a short position of Swan Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of JM Financial and Swan Energy.
Diversification Opportunities for JM Financial and Swan Energy
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between JMFINANCIL and Swan is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding JM Financial Limited and Swan Energy Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Swan Energy Limited and JM Financial 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 JM Financial Limited are associated (or correlated) with Swan Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Swan Energy Limited has no effect on the direction of JM Financial i.e., JM Financial and Swan Energy go up and down completely randomly.
Pair Corralation between JM Financial and Swan Energy
Assuming the 90 days trading horizon JM Financial Limited is expected to generate 0.86 times more return on investment than Swan Energy. However, JM Financial Limited is 1.16 times less risky than Swan Energy. It trades about -0.11 of its potential returns per unit of risk. Swan Energy Limited is currently generating about -0.26 per unit of risk. If you would invest 10,760 in JM Financial Limited on November 28, 2024 and sell it today you would lose (908.00) from holding JM Financial Limited or give up 8.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
JM Financial Limited vs. Swan Energy Limited
Performance |
| Timeline |
| JM Financial Limited |
| Swan Energy Limited |
JM Financial and Swan Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JM Financial and Swan Energy
The main advantage of trading using opposite JM Financial and Swan Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JM Financial position performs unexpectedly, Swan Energy 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 Swan Energy will offset losses from the drop in Swan Energy's long position.| JM Financial vs. Computer Age Management | JM Financial vs. Pritish Nandy Communications | JM Financial vs. Elgi Rubber | JM Financial vs. Garware Hi Tech Films |
| Swan Energy vs. Tamilnadu Telecommunication Limited | Swan Energy vs. Computer Age Management | Swan Energy vs. Kavveri Telecom Products | Swan Energy vs. Ortel Communications Limited |
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 Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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