Correlation Between Arcosa and JNS Holdings

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

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

Diversification Opportunities for Arcosa and JNS Holdings

-0.18

Correlation Coefficient

Arcosa  JNS Holdings

Good diversification

The 3 months correlation between Arcosa and JNS is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Arcosa Inc and JNS Holdings Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JNS Holdings Corp and Arcosa 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 Arcosa Inc are associated (or correlated) with JNS Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JNS Holdings Corp has no effect on the direction of Arcosa i.e., Arcosa and JNS Holdings go up and down completely randomly.

Pair Corralation between Arcosa and JNS Holdings

Considering the 90-day investment horizon Arcosa is expected to generate 10.01 times less return on investment than JNS Holdings. But when comparing it to its historical volatility, Arcosa Inc is 2.38 times less risky than JNS Holdings. It trades about 0.02 of its potential returns per unit of risk. JNS Holdings Corp is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  0.25  in JNS Holdings Corp on October 26, 2024 and sell it today you would earn a total of  0.01  from holding JNS Holdings Corp or generate 4.0% return on investment over 90 days.

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

Arcosa Inc  vs.  JNS Holdings Corp

Arcosa Inc

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Arcosa Inc are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unsteady fundamental indicators, Arcosa may actually be approaching a critical reversion point that can send shares even higher in February 2025.

JNS Holdings Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days JNS Holdings Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, JNS Holdings is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Arcosa and JNS Holdings

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

The idea behind Arcosa Inc and JNS Holdings 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.