Correlation Between New Residential and JLF INVESTMENT

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both New Residential and JLF INVESTMENT 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 New Residential and JLF INVESTMENT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between New Residential Investment and JLF INVESTMENT, you can compare the effects of market volatilities on New Residential and JLF INVESTMENT 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 New Residential with a short position of JLF INVESTMENT. Check out your portfolio center. Please also check ongoing floating volatility patterns of New Residential and JLF INVESTMENT.

Diversification Opportunities for New Residential and JLF INVESTMENT

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between New and JLF is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding New Residential Investment and JLF INVESTMENT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JLF INVESTMENT and New Residential 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 New Residential Investment are associated (or correlated) with JLF INVESTMENT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JLF INVESTMENT has no effect on the direction of New Residential i.e., New Residential and JLF INVESTMENT go up and down completely randomly.

Pair Corralation between New Residential and JLF INVESTMENT

If you would invest  946.00  in New Residential Investment on October 8, 2024 and sell it today you would earn a total of  134.00  from holding New Residential Investment or generate 14.16% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

New Residential Investment  vs.  JLF INVESTMENT

 Performance 
       Timeline  
New Residential Inve 

Risk-Adjusted Performance

16 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in New Residential Investment are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, New Residential reported solid returns over the last few months and may actually be approaching a breakup point.
JLF INVESTMENT 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days JLF INVESTMENT has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, JLF INVESTMENT is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

New Residential and JLF INVESTMENT Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with New Residential and JLF INVESTMENT

The main advantage of trading using opposite New Residential and JLF INVESTMENT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if New Residential position performs unexpectedly, JLF INVESTMENT 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 JLF INVESTMENT will offset losses from the drop in JLF INVESTMENT's long position.
The idea behind New Residential Investment and JLF INVESTMENT pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.

Other Complementary Tools

Portfolio Comparator
Compare the composition, asset allocations and performance of any two portfolios in your account
Odds Of Bankruptcy
Get analysis of equity chance of financial distress in the next 2 years
Sync Your Broker
Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors.
Competition Analyzer
Analyze and compare many basic indicators for a group of related or unrelated entities
Content Syndication
Quickly integrate customizable finance content to your own investment portal