Correlation Between FEMALE HEALTH and JINS HOLDINGS

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

By analyzing existing cross correlation between FEMALE HEALTH and JINS HOLDINGS INC, you can compare the effects of market volatilities on FEMALE HEALTH and JINS 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 FEMALE HEALTH with a short position of JINS HOLDINGS. Check out your portfolio center. Please also check ongoing floating volatility patterns of FEMALE HEALTH and JINS HOLDINGS.

Diversification Opportunities for FEMALE HEALTH and JINS HOLDINGS

-0.42

Correlation Coefficient

FEMALE HEALTH  JINS HOLDINGS

Very good diversification

The 3 months correlation between FEMALE and JINS is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding FEMALE HEALTH and JINS HOLDINGS INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JINS HOLDINGS INC and FEMALE HEALTH 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 FEMALE HEALTH are associated (or correlated) with JINS HOLDINGS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JINS HOLDINGS INC has no effect on the direction of FEMALE HEALTH i.e., FEMALE HEALTH and JINS HOLDINGS go up and down completely randomly.

Pair Corralation between FEMALE HEALTH and JINS HOLDINGS

Assuming the 90 days trading horizon FEMALE HEALTH is expected to generate 1.72 times more return on investment than JINS HOLDINGS. However, FEMALE HEALTH is 1.72 times more volatile than JINS HOLDINGS INC. It trades about 0.32 of its potential returns per unit of risk. JINS HOLDINGS INC is currently generating about -0.04 per unit of risk. If you would invest  62.00  in FEMALE HEALTH on October 22, 2024 and sell it today you would earn a total of  16.00  from holding FEMALE HEALTH or generate 25.81% return on investment over 90 days.

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

FEMALE HEALTH  vs.  JINS HOLDINGS INC

FEMALE HEALTH

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in FEMALE HEALTH are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, FEMALE HEALTH is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

JINS HOLDINGS INC

Risk-Adjusted Performance

7 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in JINS HOLDINGS INC are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, JINS HOLDINGS reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with FEMALE HEALTH and JINS HOLDINGS

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

The idea behind FEMALE HEALTH and JINS HOLDINGS INC 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.