Correlation Between Performance Technologies and J B
Can any of the company-specific risk be diversified away by investing in both Performance Technologies and J B 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 Performance Technologies and J B into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Performance Technologies SA and J B Ladenis, you can compare the effects of market volatilities on Performance Technologies and J B 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 Performance Technologies with a short position of J B. Check out your portfolio center. Please also check ongoing floating volatility patterns of Performance Technologies and J B.
Diversification Opportunities for Performance Technologies and J B
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Performance and MIN is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Performance Technologies SA and J B Ladenis in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on J B Ladenis and Performance Technologies 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 Performance Technologies SA are associated (or correlated) with J B. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of J B Ladenis has no effect on the direction of Performance Technologies i.e., Performance Technologies and J B go up and down completely randomly.
Pair Corralation between Performance Technologies and J B
Assuming the 90 days trading horizon Performance Technologies SA is expected to generate 0.53 times more return on investment than J B. However, Performance Technologies SA is 1.88 times less risky than J B. It trades about 0.01 of its potential returns per unit of risk. J B Ladenis is currently generating about -0.02 per unit of risk. If you would invest 531.00 in Performance Technologies SA on October 29, 2024 and sell it today you would earn a total of 4.00 from holding Performance Technologies SA or generate 0.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Performance Technologies SA vs. J B Ladenis
Performance |
| Timeline |
| Performance Technologies |
| J B Ladenis |
Performance Technologies and J B Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Performance Technologies and J B
The main advantage of trading using opposite Performance Technologies and J B positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Performance Technologies position performs unexpectedly, J B 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 J B will offset losses from the drop in J B's long position.| Performance Technologies vs. Quest Holdings SA | Performance Technologies vs. CPI Computer Peripherals | Performance Technologies vs. National Bank of | Performance Technologies vs. EL D Mouzakis |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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