Correlation Between PJT Partners and Employers Holdings
Can any of the company-specific risk be diversified away by investing in both PJT Partners and Employers Holdings 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 PJT Partners and Employers Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PJT Partners and Employers Holdings, you can compare the effects of market volatilities on PJT Partners and Employers Holdings 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 PJT Partners with a short position of Employers Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of PJT Partners and Employers Holdings.
Diversification Opportunities for PJT Partners and Employers Holdings
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between PJT and Employers is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding PJT Partners and Employers Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Employers Holdings and PJT Partners 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 PJT Partners are associated (or correlated) with Employers Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Employers Holdings has no effect on the direction of PJT Partners i.e., PJT Partners and Employers Holdings go up and down completely randomly.
Pair Corralation between PJT Partners and Employers Holdings
Considering the 90-day investment horizon PJT Partners is expected to generate 1.4 times more return on investment than Employers Holdings. However, PJT Partners is 1.4 times more volatile than Employers Holdings. It trades about 0.1 of its potential returns per unit of risk. Employers Holdings is currently generating about 0.03 per unit of risk. If you would invest 7,722 in PJT Partners on November 19, 2024 and sell it today you would earn a total of 9,858 from holding PJT Partners or generate 127.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PJT Partners vs. Employers Holdings
Performance |
| Timeline |
| PJT Partners |
| Employers Holdings |
PJT Partners and Employers Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PJT Partners and Employers Holdings
The main advantage of trading using opposite PJT Partners and Employers Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PJT Partners position performs unexpectedly, Employers Holdings 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 Employers Holdings will offset losses from the drop in Employers Holdings' long position.| PJT Partners vs. Scully Royalty | PJT Partners vs. Piper Sandler Companies | PJT Partners vs. Evercore Partners | PJT Partners vs. Moelis Co |
| Employers Holdings vs. ICC Holdings | Employers Holdings vs. AMERISAFE | Employers Holdings vs. NMI Holdings | Employers Holdings vs. Investors Title |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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