Correlation Between JS Bank and ORIX Leasing
Can any of the company-specific risk be diversified away by investing in both JS Bank and ORIX Leasing 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 JS Bank and ORIX Leasing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JS Bank and ORIX Leasing Pakistan, you can compare the effects of market volatilities on JS Bank and ORIX Leasing 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 JS Bank with a short position of ORIX Leasing. Check out your portfolio center. Please also check ongoing floating volatility patterns of JS Bank and ORIX Leasing.
Diversification Opportunities for JS Bank and ORIX Leasing
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between JSBL and ORIX is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding JS Bank and ORIX Leasing Pakistan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ORIX Leasing Pakistan and JS Bank 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 JS Bank are associated (or correlated) with ORIX Leasing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ORIX Leasing Pakistan has no effect on the direction of JS Bank i.e., JS Bank and ORIX Leasing go up and down completely randomly.
Pair Corralation between JS Bank and ORIX Leasing
Assuming the 90 days trading horizon JS Bank is expected to generate 1.84 times less return on investment than ORIX Leasing. In addition to that, JS Bank is 1.67 times more volatile than ORIX Leasing Pakistan. It trades about 0.05 of its total potential returns per unit of risk. ORIX Leasing Pakistan is currently generating about 0.14 per unit of volatility. If you would invest 2,533 in ORIX Leasing Pakistan on October 13, 2024 and sell it today you would earn a total of 1,009 from holding ORIX Leasing Pakistan or generate 39.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.29% |
| Values | Daily Returns |
JS Bank vs. ORIX Leasing Pakistan
Performance |
| Timeline |
| JS Bank |
| ORIX Leasing Pakistan |
JS Bank and ORIX Leasing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JS Bank and ORIX Leasing
The main advantage of trading using opposite JS Bank and ORIX Leasing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JS Bank position performs unexpectedly, ORIX Leasing 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 ORIX Leasing will offset losses from the drop in ORIX Leasing's long position.| JS Bank vs. EFU General Insurance | JS Bank vs. Atlas Insurance | JS Bank vs. Fateh Sports Wear | JS Bank vs. Shaheen Insurance |
| ORIX Leasing vs. Fauji Foods | ORIX Leasing vs. Universal Insurance | ORIX Leasing vs. JS Global Banking | ORIX Leasing vs. NetSol Technologies |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets |