Correlation Between STELLA-JONES INC and STELLA INTERNATIONA

Can any of the company-specific risk be diversified away by investing in both STELLA-JONES INC and STELLA INTERNATIONA 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 STELLA-JONES INC and STELLA INTERNATIONA into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between STELLA JONES INC and STELLA INTERNATIONA, you can compare the effects of market volatilities on STELLA-JONES INC and STELLA INTERNATIONA 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 STELLA-JONES INC with a short position of STELLA INTERNATIONA. Check out your portfolio center. Please also check ongoing floating volatility patterns of STELLA-JONES INC and STELLA INTERNATIONA.

Diversification Opportunities for STELLA-JONES INC and STELLA INTERNATIONA

0.0

Correlation Coefficient

STELLA-JONES INC  STELLA INTERNATIONA

Pay attention - limited upside

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

Pair Corralation between STELLA-JONES INC and STELLA INTERNATIONA

If you would invest  4,600  in STELLA JONES INC on October 22, 2024 and sell it today you would earn a total of  20.00  from holding STELLA JONES INC or generate 0.43% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	5.88%
Values	Daily Returns

STELLA JONES INC  vs.  STELLA INTERNATIONA

STELLA JONES INC

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days STELLA JONES INC has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

STELLA INTERNATIONA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days STELLA INTERNATIONA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, STELLA INTERNATIONA is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with STELLA-JONES INC and STELLA INTERNATIONA

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

The idea behind STELLA JONES INC and STELLA INTERNATIONA 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.