Correlation Between Jamieson Wellness and Labrador Iron
Can any of the company-specific risk be diversified away by investing in both Jamieson Wellness and Labrador Iron 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 Jamieson Wellness and Labrador Iron into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jamieson Wellness and Labrador Iron Ore, you can compare the effects of market volatilities on Jamieson Wellness and Labrador Iron 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 Jamieson Wellness with a short position of Labrador Iron. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jamieson Wellness and Labrador Iron.
Diversification Opportunities for Jamieson Wellness and Labrador Iron
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Jamieson and Labrador is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Jamieson Wellness and Labrador Iron Ore in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Labrador Iron Ore and Jamieson Wellness 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 Jamieson Wellness are associated (or correlated) with Labrador Iron. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Labrador Iron Ore has no effect on the direction of Jamieson Wellness i.e., Jamieson Wellness and Labrador Iron go up and down completely randomly.
Pair Corralation between Jamieson Wellness and Labrador Iron
Assuming the 90 days trading horizon Jamieson Wellness is expected to generate 1.44 times more return on investment than Labrador Iron. However, Jamieson Wellness is 1.44 times more volatile than Labrador Iron Ore. It trades about 0.14 of its potential returns per unit of risk. Labrador Iron Ore is currently generating about -0.24 per unit of risk. If you would invest 3,449 in Jamieson Wellness on August 29, 2024 and sell it today you would earn a total of 197.00 from holding Jamieson Wellness or generate 5.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jamieson Wellness vs. Labrador Iron Ore
Performance |
| Timeline |
| Jamieson Wellness |
| Labrador Iron Ore |
Jamieson Wellness and Labrador Iron Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jamieson Wellness and Labrador Iron
The main advantage of trading using opposite Jamieson Wellness and Labrador Iron positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jamieson Wellness position performs unexpectedly, Labrador Iron 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 Labrador Iron will offset losses from the drop in Labrador Iron's long position.| Jamieson Wellness vs. Slate Grocery REIT | Jamieson Wellness vs. Roots Corp | Jamieson Wellness vs. Aimia Inc | Jamieson Wellness vs. Morguard Real Estate |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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