Correlation Between Jetwell Computer and Wistron Corp

Can any of the company-specific risk be diversified away by investing in both Jetwell Computer and Wistron Corp 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 Jetwell Computer and Wistron Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Jetwell Computer Co and Wistron Corp, you can compare the effects of market volatilities on Jetwell Computer and Wistron Corp 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 Jetwell Computer with a short position of Wistron Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jetwell Computer and Wistron Corp.

Diversification Opportunities for Jetwell Computer and Wistron Corp

-0.77

Correlation Coefficient

Jetwell Computer  Wistron Corp

Pay attention - limited upside

The 3 months correlation between Jetwell and Wistron is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Jetwell Computer Co and Wistron Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wistron Corp and Jetwell Computer 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 Jetwell Computer Co are associated (or correlated) with Wistron Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wistron Corp has no effect on the direction of Jetwell Computer i.e., Jetwell Computer and Wistron Corp go up and down completely randomly.

Pair Corralation between Jetwell Computer and Wistron Corp

Assuming the 90 days trading horizon Jetwell Computer Co is expected to under-perform the Wistron Corp. In addition to that, Jetwell Computer is 1.75 times more volatile than Wistron Corp. It trades about -0.1 of its total potential returns per unit of risk. Wistron Corp is currently generating about 0.08 per unit of volatility. If you would invest  10,800  in Wistron Corp on October 24, 2024 and sell it today you would earn a total of  350.00  from holding Wistron Corp or generate 3.24% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Jetwell Computer Co  vs.  Wistron Corp

Jetwell Computer

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Jetwell Computer Co are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Jetwell Computer may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Wistron Corp

Risk-Adjusted Performance

1 of 100

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Wistron Corp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable basic indicators, Wistron Corp is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Jetwell Computer and Wistron Corp

The main advantage of trading using opposite Jetwell Computer and Wistron Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jetwell Computer position performs unexpectedly, Wistron Corp 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 Wistron Corp will offset losses from the drop in Wistron Corp's long position.

The idea behind Jetwell Computer Co and Wistron Corp 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.

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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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.