Correlation Between Bukit Jalil and John Wiley

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

By analyzing existing cross correlation between Bukit Jalil Global and John Wiley Sons, you can compare the effects of market volatilities on Bukit Jalil and John Wiley 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 Bukit Jalil with a short position of John Wiley. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bukit Jalil and John Wiley.

Diversification Opportunities for Bukit Jalil and John Wiley

-0.27

Correlation Coefficient

Bukit Jalil  John Wiley

Very good diversification

The 3 months correlation between Bukit and John is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Bukit Jalil Global and John Wiley Sons in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Wiley Sons and Bukit Jalil 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 Bukit Jalil Global are associated (or correlated) with John Wiley. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of John Wiley Sons has no effect on the direction of Bukit Jalil i.e., Bukit Jalil and John Wiley go up and down completely randomly.

Pair Corralation between Bukit Jalil and John Wiley

Assuming the 90 days horizon Bukit Jalil is expected to generate 14.48 times less return on investment than John Wiley. But when comparing it to its historical volatility, Bukit Jalil Global is 6.65 times less risky than John Wiley. It trades about 0.04 of its potential returns per unit of risk. John Wiley Sons is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  3,223  in John Wiley Sons on October 4, 2024 and sell it today you would earn a total of  1,183  from holding John Wiley Sons or generate 36.7% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	44.16%
Values	Daily Returns

Bukit Jalil Global  vs.  John Wiley Sons

Bukit Jalil Global

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Bukit Jalil Global are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Even with relatively uncertain basic indicators, Bukit Jalil reported solid returns over the last few months and may actually be approaching a breakup point.

John Wiley Sons

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days John Wiley Sons has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest inconsistent performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Bukit Jalil and John Wiley

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

The idea behind Bukit Jalil Global and John Wiley Sons 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.