Correlation Between Orion Group and JGC Corp
Can any of the company-specific risk be diversified away by investing in both Orion Group and JGC Corp 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 Orion Group and JGC Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Orion Group Holdings and JGC Corp, you can compare the effects of market volatilities on Orion Group and JGC Corp 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 Orion Group with a short position of JGC Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Orion Group and JGC Corp.
Diversification Opportunities for Orion Group and JGC Corp
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Orion and JGC is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Orion Group Holdings and JGC Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JGC Corp and Orion Group 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 Orion Group Holdings are associated (or correlated) with JGC Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JGC Corp has no effect on the direction of Orion Group i.e., Orion Group and JGC Corp go up and down completely randomly.
Pair Corralation between Orion Group and JGC Corp
Considering the 90-day investment horizon Orion Group Holdings is expected to generate 1.79 times more return on investment than JGC Corp. However, Orion Group is 1.79 times more volatile than JGC Corp. It trades about 0.09 of its potential returns per unit of risk. JGC Corp is currently generating about -0.03 per unit of risk. If you would invest 262.00 in Orion Group Holdings on September 1, 2024 and sell it today you would earn a total of 610.00 from holding Orion Group Holdings or generate 232.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Orion Group Holdings vs. JGC Corp
Performance |
| Timeline |
| Orion Group Holdings |
| JGC Corp |
Orion Group and JGC Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Orion Group and JGC Corp
The main advantage of trading using opposite Orion Group and JGC Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Orion Group position performs unexpectedly, JGC Corp 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 JGC Corp will offset losses from the drop in JGC Corp's long position.| Orion Group vs. MYR Group | Orion Group vs. Granite Construction Incorporated | Orion Group vs. Construction Partners | Orion Group vs. Great Lakes Dredge |
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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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