Correlation Between Brockhaus Capital and JERONIMO MARTINS

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

By analyzing existing cross correlation between Brockhaus Capital Management and JERONIMO MARTINS UNADR2, you can compare the effects of market volatilities on Brockhaus Capital and JERONIMO MARTINS 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 Brockhaus Capital with a short position of JERONIMO MARTINS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brockhaus Capital and JERONIMO MARTINS.

Diversification Opportunities for Brockhaus Capital and JERONIMO MARTINS

-0.23

Correlation Coefficient

Brockhaus Capital  JERONIMO MARTINS

Very good diversification

The 3 months correlation between Brockhaus and JERONIMO is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Brockhaus Capital Management and JERONIMO MARTINS UNADR2 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JERONIMO MARTINS UNADR2 and Brockhaus Capital 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 Brockhaus Capital Management are associated (or correlated) with JERONIMO MARTINS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JERONIMO MARTINS UNADR2 has no effect on the direction of Brockhaus Capital i.e., Brockhaus Capital and JERONIMO MARTINS go up and down completely randomly.

Pair Corralation between Brockhaus Capital and JERONIMO MARTINS

Assuming the 90 days trading horizon Brockhaus Capital Management is expected to under-perform the JERONIMO MARTINS. In addition to that, Brockhaus Capital is 1.93 times more volatile than JERONIMO MARTINS UNADR2. It trades about -0.1 of its total potential returns per unit of risk. JERONIMO MARTINS UNADR2 is currently generating about 0.07 per unit of volatility. If you would invest  3,560  in JERONIMO MARTINS UNADR2 on December 24, 2024 and sell it today you would earn a total of  260.00  from holding JERONIMO MARTINS UNADR2 or generate 7.3% return on investment over 90 days.

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

Brockhaus Capital Management  vs.  JERONIMO MARTINS UNADR2

Brockhaus Capital

Risk-Adjusted Performance

Very Weak

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

JERONIMO MARTINS UNADR2

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in JERONIMO MARTINS UNADR2 are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile primary indicators, JERONIMO MARTINS may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Brockhaus Capital and JERONIMO MARTINS

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

The idea behind Brockhaus Capital Management and JERONIMO MARTINS UNADR2 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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.