Correlation Between Marvell Technology and Jefferies Financial
Can any of the company-specific risk be diversified away by investing in both Marvell Technology and Jefferies Financial 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 Marvell Technology and Jefferies Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marvell Technology Group and Jefferies Financial Group, you can compare the effects of market volatilities on Marvell Technology and Jefferies Financial 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 Marvell Technology with a short position of Jefferies Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marvell Technology and Jefferies Financial.
Diversification Opportunities for Marvell Technology and Jefferies Financial
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Marvell and Jefferies is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Marvell Technology Group and Jefferies Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jefferies Financial and Marvell Technology 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 Marvell Technology Group are associated (or correlated) with Jefferies Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jefferies Financial has no effect on the direction of Marvell Technology i.e., Marvell Technology and Jefferies Financial go up and down completely randomly.
Pair Corralation between Marvell Technology and Jefferies Financial
Given the investment horizon of 90 days Marvell Technology Group is expected to generate 0.77 times more return on investment than Jefferies Financial. However, Marvell Technology Group is 1.3 times less risky than Jefferies Financial. It trades about 0.22 of its potential returns per unit of risk. Jefferies Financial Group is currently generating about -0.07 per unit of risk. If you would invest 11,565 in Marvell Technology Group on October 26, 2024 and sell it today you would earn a total of 1,041 from holding Marvell Technology Group or generate 9.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 94.74% |
| Values | Daily Returns |
Marvell Technology Group vs. Jefferies Financial Group
Performance |
| Timeline |
| Marvell Technology |
| Jefferies Financial |
Marvell Technology and Jefferies Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Marvell Technology and Jefferies Financial
The main advantage of trading using opposite Marvell Technology and Jefferies Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marvell Technology position performs unexpectedly, Jefferies Financial 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 Jefferies Financial will offset losses from the drop in Jefferies Financial's long position.| Marvell Technology vs. NVIDIA | Marvell Technology vs. Intel | Marvell Technology vs. Taiwan Semiconductor Manufacturing | Marvell Technology vs. Micron Technology |
| Jefferies Financial vs. Lazard | Jefferies Financial vs. PJT Partners | Jefferies Financial vs. Moelis Co | Jefferies Financial vs. Houlihan Lokey |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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