Correlation Between Neste Oyj and Jacquet Metal
Can any of the company-specific risk be diversified away by investing in both Neste Oyj 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 Neste Oyj and Jacquet Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Neste Oyj and Jacquet Metal Service, you can compare the effects of market volatilities on Neste Oyj 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 Neste Oyj with a short position of Jacquet Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Neste Oyj and Jacquet Metal.
Diversification Opportunities for Neste Oyj and Jacquet Metal
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Neste and Jacquet is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Neste Oyj 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 Neste Oyj 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 Neste Oyj 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 Neste Oyj i.e., Neste Oyj and Jacquet Metal go up and down completely randomly.
Pair Corralation between Neste Oyj and Jacquet Metal
Assuming the 90 days horizon Neste Oyj is expected to generate 1.34 times more return on investment than Jacquet Metal. However, Neste Oyj is 1.34 times more volatile than Jacquet Metal Service. It trades about 0.12 of its potential returns per unit of risk. Jacquet Metal Service is currently generating about 0.13 per unit of risk. If you would invest 1,276 in Neste Oyj on September 13, 2024 and sell it today you would earn a total of 67.00 from holding Neste Oyj or generate 5.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Neste Oyj vs. Jacquet Metal Service
Performance |
| Timeline |
| Neste Oyj |
| Jacquet Metal Service |
Neste Oyj and Jacquet Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Neste Oyj and Jacquet Metal
The main advantage of trading using opposite Neste Oyj and Jacquet Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Neste Oyj 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.| Neste Oyj vs. Ribbon Communications | Neste Oyj vs. INTER CARS SA | Neste Oyj vs. WillScot Mobile Mini | Neste Oyj vs. CARSALESCOM |
| Jacquet Metal vs. ArcelorMittal | Jacquet Metal vs. NIPPON STEEL SPADR | Jacquet Metal vs. Reliance Steel Aluminum | Jacquet Metal vs. Superior Plus Corp |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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