Correlation Between Jacquet Metal and Anglo American
Can any of the company-specific risk be diversified away by investing in both Jacquet Metal and Anglo American 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 Jacquet Metal and Anglo American into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jacquet Metal Service and Anglo American PLC, you can compare the effects of market volatilities on Jacquet Metal and Anglo American 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 Jacquet Metal with a short position of Anglo American. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jacquet Metal and Anglo American.
Diversification Opportunities for Jacquet Metal and Anglo American
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Jacquet and Anglo is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Jacquet Metal Service and Anglo American PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anglo American PLC and Jacquet Metal 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 Jacquet Metal Service are associated (or correlated) with Anglo American. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anglo American PLC has no effect on the direction of Jacquet Metal i.e., Jacquet Metal and Anglo American go up and down completely randomly.
Pair Corralation between Jacquet Metal and Anglo American
Assuming the 90 days trading horizon Jacquet Metal Service is expected to generate 1.03 times more return on investment than Anglo American. However, Jacquet Metal is 1.03 times more volatile than Anglo American PLC. It trades about 0.12 of its potential returns per unit of risk. Anglo American PLC is currently generating about -0.01 per unit of risk. If you would invest 1,715 in Jacquet Metal Service on December 30, 2024 and sell it today you would earn a total of 305.00 from holding Jacquet Metal Service or generate 17.78% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Jacquet Metal Service vs. Anglo American PLC
Performance |
Timeline |
Jacquet Metal Service |
Anglo American PLC |
Jacquet Metal and Anglo American Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Jacquet Metal and Anglo American
The main advantage of trading using opposite Jacquet Metal and Anglo American positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jacquet Metal position performs unexpectedly, Anglo American 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 Anglo American will offset losses from the drop in Anglo American's long position.Jacquet Metal vs. Atalaya Mining | Jacquet Metal vs. Resolute Mining Limited | Jacquet Metal vs. Associated British Foods | Jacquet Metal vs. Rosslyn Data Technologies |
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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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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