Correlation Between Cemex SAB and Jewett Cameron

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

By analyzing existing cross correlation between Cemex SAB de and Jewett Cameron Trading, you can compare the effects of market volatilities on Cemex SAB and Jewett Cameron 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 Cemex SAB with a short position of Jewett Cameron. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cemex SAB and Jewett Cameron.

Diversification Opportunities for Cemex SAB and Jewett Cameron

0.04

Correlation Coefficient

Cemex SAB  Jewett Cameron

Significant diversification

The 3 months correlation between Cemex and Jewett is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Cemex SAB de and Jewett Cameron Trading in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jewett Cameron Trading and Cemex SAB 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 Cemex SAB de are associated (or correlated) with Jewett Cameron. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jewett Cameron Trading has no effect on the direction of Cemex SAB i.e., Cemex SAB and Jewett Cameron go up and down completely randomly.

Pair Corralation between Cemex SAB and Jewett Cameron

Allowing for the 90-day total investment horizon Cemex SAB is expected to generate 1.06 times less return on investment than Jewett Cameron. But when comparing it to its historical volatility, Cemex SAB de is 1.32 times less risky than Jewett Cameron. It trades about 0.06 of its potential returns per unit of risk. Jewett Cameron Trading is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  421.00  in Jewett Cameron Trading on December 28, 2024 and sell it today you would earn a total of  29.00  from holding Jewett Cameron Trading or generate 6.89% return on investment over 90 days.

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

Cemex SAB de  vs.  Jewett Cameron Trading

Cemex SAB de

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Cemex SAB de are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating basic indicators, Cemex SAB may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Jewett Cameron Trading

Risk-Adjusted Performance

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Jewett Cameron Trading are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather inconsistent basic indicators, Jewett Cameron may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Cemex SAB and Jewett Cameron

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

The idea behind Cemex SAB de and Jewett Cameron Trading 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.