Correlation Between Shutterstock and JAPAN TOBACCO
Can any of the company-specific risk be diversified away by investing in both Shutterstock and JAPAN TOBACCO 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 Shutterstock and JAPAN TOBACCO into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shutterstock and JAPAN TOBACCO UNSPADR12, you can compare the effects of market volatilities on Shutterstock and JAPAN TOBACCO 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 Shutterstock with a short position of JAPAN TOBACCO. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shutterstock and JAPAN TOBACCO.
Diversification Opportunities for Shutterstock and JAPAN TOBACCO
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shutterstock and JAPAN is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Shutterstock and JAPAN TOBACCO UNSPADR12 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JAPAN TOBACCO UNSPADR12 and Shutterstock 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 Shutterstock are associated (or correlated) with JAPAN TOBACCO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JAPAN TOBACCO UNSPADR12 has no effect on the direction of Shutterstock i.e., Shutterstock and JAPAN TOBACCO go up and down completely randomly.
Pair Corralation between Shutterstock and JAPAN TOBACCO
Assuming the 90 days trading horizon Shutterstock is expected to under-perform the JAPAN TOBACCO. In addition to that, Shutterstock is 2.15 times more volatile than JAPAN TOBACCO UNSPADR12. It trades about -0.05 of its total potential returns per unit of risk. JAPAN TOBACCO UNSPADR12 is currently generating about 0.04 per unit of volatility. If you would invest 856.00 in JAPAN TOBACCO UNSPADR12 on December 4, 2024 and sell it today you would earn a total of 294.00 from holding JAPAN TOBACCO UNSPADR12 or generate 34.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Shutterstock vs. JAPAN TOBACCO UNSPADR12
Performance |
| Timeline |
| Shutterstock |
| JAPAN TOBACCO UNSPADR12 |
Shutterstock and JAPAN TOBACCO Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shutterstock and JAPAN TOBACCO
The main advantage of trading using opposite Shutterstock and JAPAN TOBACCO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shutterstock position performs unexpectedly, JAPAN TOBACCO 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 JAPAN TOBACCO will offset losses from the drop in JAPAN TOBACCO's long position.| Shutterstock vs. Tokyu Construction Co | Shutterstock vs. American Eagle Outfitters | Shutterstock vs. Veolia Environnement SA | Shutterstock vs. AGRICULTBK HADR25 YC |
| JAPAN TOBACCO vs. Corporate Travel Management | JAPAN TOBACCO vs. Zoom Video Communications | JAPAN TOBACCO vs. ARDAGH METAL PACDL 0001 | JAPAN TOBACCO vs. CEOTRONICS |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Other Complementary Tools
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. |