Correlation Between BANDAI NAMCO and JAKKS Pacific
Can any of the company-specific risk be diversified away by investing in both BANDAI NAMCO and JAKKS Pacific 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 BANDAI NAMCO and JAKKS Pacific into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BANDAI NAMCO Holdings and JAKKS Pacific, you can compare the effects of market volatilities on BANDAI NAMCO and JAKKS Pacific 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 BANDAI NAMCO with a short position of JAKKS Pacific. Check out your portfolio center. Please also check ongoing floating volatility patterns of BANDAI NAMCO and JAKKS Pacific.
Diversification Opportunities for BANDAI NAMCO and JAKKS Pacific
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between BANDAI and JAKKS is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding BANDAI NAMCO Holdings and JAKKS Pacific in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JAKKS Pacific and BANDAI NAMCO 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 BANDAI NAMCO Holdings are associated (or correlated) with JAKKS Pacific. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JAKKS Pacific has no effect on the direction of BANDAI NAMCO i.e., BANDAI NAMCO and JAKKS Pacific go up and down completely randomly.
Pair Corralation between BANDAI NAMCO and JAKKS Pacific
Assuming the 90 days horizon BANDAI NAMCO is expected to generate 26.83 times less return on investment than JAKKS Pacific. But when comparing it to its historical volatility, BANDAI NAMCO Holdings is 1.98 times less risky than JAKKS Pacific. It trades about 0.0 of its potential returns per unit of risk. JAKKS Pacific is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,756 in JAKKS Pacific on August 27, 2024 and sell it today you would earn a total of 1,023 from holding JAKKS Pacific or generate 58.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BANDAI NAMCO Holdings vs. JAKKS Pacific
Performance |
| Timeline |
| BANDAI NAMCO Holdings |
| JAKKS Pacific |
BANDAI NAMCO and JAKKS Pacific Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BANDAI NAMCO and JAKKS Pacific
The main advantage of trading using opposite BANDAI NAMCO and JAKKS Pacific positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BANDAI NAMCO position performs unexpectedly, JAKKS Pacific 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 JAKKS Pacific will offset losses from the drop in JAKKS Pacific's long position.| BANDAI NAMCO vs. Shimano Inc ADR | BANDAI NAMCO vs. Hasbro Inc | BANDAI NAMCO vs. YETI Holdings | BANDAI NAMCO vs. Madison Square Garden |
| JAKKS Pacific vs. Escalade Incorporated | JAKKS Pacific vs. Clarus Corp | JAKKS Pacific vs. Six Flags Entertainment | JAKKS Pacific vs. American Outdoor Brands |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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