Correlation Between Nucor and Jacquet Metal
Can any of the company-specific risk be diversified away by investing in both Nucor 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 Nucor and Jacquet Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nucor and Jacquet Metal Service, you can compare the effects of market volatilities on Nucor 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 Nucor with a short position of Jacquet Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nucor and Jacquet Metal.
Diversification Opportunities for Nucor and Jacquet Metal
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Nucor and Jacquet is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Nucor 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 Nucor 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 Nucor 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 Nucor i.e., Nucor and Jacquet Metal go up and down completely randomly.
Pair Corralation between Nucor and Jacquet Metal
Assuming the 90 days horizon Nucor is expected to generate 1.25 times more return on investment than Jacquet Metal. However, Nucor is 1.25 times more volatile than Jacquet Metal Service. It trades about 0.23 of its potential returns per unit of risk. Jacquet Metal Service is currently generating about -0.38 per unit of risk. If you would invest 11,028 in Nucor on October 23, 2024 and sell it today you would earn a total of 1,088 from holding Nucor or generate 9.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nucor vs. Jacquet Metal Service
Performance |
| Timeline |
| Nucor |
| Jacquet Metal Service |
Nucor and Jacquet Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nucor and Jacquet Metal
The main advantage of trading using opposite Nucor and Jacquet Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nucor 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.| Nucor vs. CARSALESCOM | Nucor vs. Eidesvik Offshore ASA | Nucor vs. MARKET VECTR RETAIL | Nucor vs. Salesforce |
| Jacquet Metal vs. Nucor | Jacquet Metal vs. ArcelorMittal SA | Jacquet Metal vs. ArcelorMittal | Jacquet Metal vs. Steel Dynamics |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |