Correlation Between Lions Gate and Jacquet Metal
Can any of the company-specific risk be diversified away by investing in both Lions Gate and Jacquet Metal 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 Lions Gate and Jacquet Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lions Gate Entertainment and Jacquet Metal Service, you can compare the effects of market volatilities on Lions Gate and Jacquet Metal 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 Lions Gate with a short position of Jacquet Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lions Gate and Jacquet Metal.
Diversification Opportunities for Lions Gate and Jacquet Metal
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Lions and Jacquet is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Lions Gate Entertainment and Jacquet Metal Service in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jacquet Metal Service and Lions Gate 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 Lions Gate Entertainment are associated (or correlated) with Jacquet Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jacquet Metal Service has no effect on the direction of Lions Gate i.e., Lions Gate and Jacquet Metal go up and down completely randomly.
Pair Corralation between Lions Gate and Jacquet Metal
Assuming the 90 days trading horizon Lions Gate Entertainment is expected to generate 1.4 times more return on investment than Jacquet Metal. However, Lions Gate is 1.4 times more volatile than Jacquet Metal Service. It trades about 0.09 of its potential returns per unit of risk. Jacquet Metal Service is currently generating about 0.04 per unit of risk. If you would invest 620.00 in Lions Gate Entertainment on September 3, 2024 and sell it today you would earn a total of 75.00 from holding Lions Gate Entertainment or generate 12.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lions Gate Entertainment vs. Jacquet Metal Service
Performance |
| Timeline |
| Lions Gate Entertainment |
| Jacquet Metal Service |
Lions Gate and Jacquet Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lions Gate and Jacquet Metal
The main advantage of trading using opposite Lions Gate and Jacquet Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lions Gate position performs unexpectedly, Jacquet Metal 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 Jacquet Metal will offset losses from the drop in Jacquet Metal's long position.| Lions Gate vs. Jacquet Metal Service | Lions Gate vs. COFCO Joycome Foods | Lions Gate vs. Lifeway Foods | Lions Gate vs. Thai Beverage Public |
| Jacquet Metal vs. XLMedia PLC | Jacquet Metal vs. Tencent Music Entertainment | Jacquet Metal vs. ATRESMEDIA | Jacquet Metal vs. TOWNSQUARE MEDIA INC |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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