Correlation Between Netmedia Group and Jacquet Metal

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

By analyzing existing cross correlation between Netmedia Group SA and Jacquet Metal Service, you can compare the effects of market volatilities on Netmedia Group and Jacquet Metal 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 Netmedia Group with a short position of Jacquet Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Netmedia Group and Jacquet Metal.

Diversification Opportunities for Netmedia Group and Jacquet Metal

0.1

Correlation Coefficient

Netmedia Group  Jacquet Metal

Average diversification

The 3 months correlation between Netmedia and Jacquet is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Netmedia Group SA and Jacquet Metal Service in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jacquet Metal Service and Netmedia Group 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 Netmedia Group SA are associated (or correlated) with Jacquet Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jacquet Metal Service has no effect on the direction of Netmedia Group i.e., Netmedia Group and Jacquet Metal go up and down completely randomly.

Pair Corralation between Netmedia Group and Jacquet Metal

Assuming the 90 days trading horizon Netmedia Group SA is expected to under-perform the Jacquet Metal. In addition to that, Netmedia Group is 3.14 times more volatile than Jacquet Metal Service. It trades about -0.02 of its total potential returns per unit of risk. Jacquet Metal Service is currently generating about 0.15 per unit of volatility. If you would invest  1,556  in Jacquet Metal Service on December 2, 2024 and sell it today you would earn a total of  226.00  from holding Jacquet Metal Service or generate 14.52% return on investment over 90 days.

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

Netmedia Group SA  vs.  Jacquet Metal Service

Netmedia Group SA

Risk-Adjusted Performance

Very Weak

Over the last 90 days Netmedia Group SA has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Netmedia Group is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Jacquet Metal Service

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Jacquet Metal Service are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Jacquet Metal sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Netmedia Group and Jacquet Metal

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

The idea behind Netmedia Group SA and Jacquet Metal Service 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.