Correlation Between Jutal Offshore and Encore Capital
Can any of the company-specific risk be diversified away by investing in both Jutal Offshore and Encore Capital 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 Jutal Offshore and Encore Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jutal Offshore Oil and Encore Capital Group, you can compare the effects of market volatilities on Jutal Offshore and Encore Capital 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 Jutal Offshore with a short position of Encore Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jutal Offshore and Encore Capital.
Diversification Opportunities for Jutal Offshore and Encore Capital
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Jutal and Encore is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Jutal Offshore Oil and Encore Capital Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Encore Capital Group and Jutal Offshore 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 Jutal Offshore Oil are associated (or correlated) with Encore Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Encore Capital Group has no effect on the direction of Jutal Offshore i.e., Jutal Offshore and Encore Capital go up and down completely randomly.
Pair Corralation between Jutal Offshore and Encore Capital
Assuming the 90 days horizon Jutal Offshore is expected to generate 3.31 times less return on investment than Encore Capital. In addition to that, Jutal Offshore is 1.51 times more volatile than Encore Capital Group. It trades about 0.0 of its total potential returns per unit of risk. Encore Capital Group is currently generating about 0.01 per unit of volatility. If you would invest 4,926 in Encore Capital Group on August 30, 2024 and sell it today you would earn a total of 12.00 from holding Encore Capital Group or generate 0.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jutal Offshore Oil vs. Encore Capital Group
Performance |
| Timeline |
| Jutal Offshore Oil |
| Encore Capital Group |
Jutal Offshore and Encore Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jutal Offshore and Encore Capital
The main advantage of trading using opposite Jutal Offshore and Encore Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jutal Offshore position performs unexpectedly, Encore Capital 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 Encore Capital will offset losses from the drop in Encore Capital's long position.| Jutal Offshore vs. Expro Group Holdings | Jutal Offshore vs. ChampionX | Jutal Offshore vs. Ranger Energy Services | Jutal Offshore vs. Cactus Inc |
| Encore Capital vs. Guild Holdings Co | Encore Capital vs. Mr Cooper Group | Encore Capital vs. CNFinance Holdings | Encore Capital vs. Security National Financial |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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