Correlation Between South Jersey and Take Two
Can any of the company-specific risk be diversified away by investing in both South Jersey and Take Two 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 South Jersey and Take Two into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between South Jersey Industries and Take Two Interactive Software, you can compare the effects of market volatilities on South Jersey and Take Two 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 South Jersey with a short position of Take Two. Check out your portfolio center. Please also check ongoing floating volatility patterns of South Jersey and Take Two.
Diversification Opportunities for South Jersey and Take Two
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between South and Take is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding South Jersey Industries and Take Two Interactive Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Take Two Interactive and South Jersey 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 South Jersey Industries are associated (or correlated) with Take Two. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Take Two Interactive has no effect on the direction of South Jersey i.e., South Jersey and Take Two go up and down completely randomly.
Pair Corralation between South Jersey and Take Two
If you would invest 18,790 in Take Two Interactive Software on October 9, 2024 and sell it today you would earn a total of 108.00 from holding Take Two Interactive Software or generate 0.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 5.26% |
| Values | Daily Returns |
South Jersey Industries vs. Take Two Interactive Software
Performance |
| Timeline |
| South Jersey Industries |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Take Two Interactive |
South Jersey and Take Two Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with South Jersey and Take Two
The main advantage of trading using opposite South Jersey and Take Two positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if South Jersey position performs unexpectedly, Take Two 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 Take Two will offset losses from the drop in Take Two's long position.| South Jersey vs. JD Sports Fashion | South Jersey vs. Thor Industries | South Jersey vs. Valneva SE ADR | South Jersey vs. Playa Hotels Resorts |
| Take Two vs. Nintendo Co ADR | Take Two vs. NetEase | Take Two vs. Playtika Holding Corp | Take Two vs. Electronic Arts |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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