Correlation Between JSE and CoreShares Preference
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By analyzing existing cross correlation between JSE Limited and CoreShares Preference Share, you can compare the effects of market volatilities on JSE and CoreShares Preference 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 JSE with a short position of CoreShares Preference. Check out your portfolio center. Please also check ongoing floating volatility patterns of JSE and CoreShares Preference.
Diversification Opportunities for JSE and CoreShares Preference
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between JSE and CoreShares is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding JSE Limited and CoreShares Preference Share in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CoreShares Preference and JSE 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 JSE Limited are associated (or correlated) with CoreShares Preference. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CoreShares Preference has no effect on the direction of JSE i.e., JSE and CoreShares Preference go up and down completely randomly.
Pair Corralation between JSE and CoreShares Preference
Assuming the 90 days trading horizon JSE Limited is expected to generate 4.79 times more return on investment than CoreShares Preference. However, JSE is 4.79 times more volatile than CoreShares Preference Share. It trades about 0.09 of its potential returns per unit of risk. CoreShares Preference Share is currently generating about 0.11 per unit of risk. If you would invest 873,900 in JSE Limited on August 27, 2024 and sell it today you would earn a total of 337,500 from holding JSE Limited or generate 38.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.59% |
| Values | Daily Returns |
JSE Limited vs. CoreShares Preference Share
Performance |
| Timeline |
| JSE Limited |
| CoreShares Preference |
JSE and CoreShares Preference Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JSE and CoreShares Preference
The main advantage of trading using opposite JSE and CoreShares Preference positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JSE position performs unexpectedly, CoreShares Preference 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 CoreShares Preference will offset losses from the drop in CoreShares Preference's long position.| JSE vs. Prosus NV | JSE vs. Compagnie Financire Richemont | JSE vs. British American Tobacco | JSE vs. Glencore PLC |
| CoreShares Preference vs. CoreShares SP Global | CoreShares Preference vs. CoreShares SP 500 | CoreShares Preference vs. CoreShares Income AMETF | CoreShares Preference vs. CoreShares Yield Selected |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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