Correlation Between Jfrog and MARTIN

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

By analyzing existing cross correlation between Jfrog and MARTIN MARIETTA MATLS, you can compare the effects of market volatilities on Jfrog and MARTIN 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 Jfrog with a short position of MARTIN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jfrog and MARTIN.

Diversification Opportunities for Jfrog and MARTIN

0.28

Correlation Coefficient

Jfrog  MARTIN

Modest diversification

The 3 months correlation between Jfrog and MARTIN is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Jfrog and MARTIN MARIETTA MATLS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MARTIN MARIETTA MATLS and Jfrog 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 Jfrog are associated (or correlated) with MARTIN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MARTIN MARIETTA MATLS has no effect on the direction of Jfrog i.e., Jfrog and MARTIN go up and down completely randomly.

Pair Corralation between Jfrog and MARTIN

Given the investment horizon of 90 days Jfrog is expected to generate 9.23 times more return on investment than MARTIN. However, Jfrog is 9.23 times more volatile than MARTIN MARIETTA MATLS. It trades about 0.1 of its potential returns per unit of risk. MARTIN MARIETTA MATLS is currently generating about 0.07 per unit of risk. If you would invest  3,017  in Jfrog on December 22, 2024 and sell it today you would earn a total of  381.00  from holding Jfrog or generate 12.63% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.39%
Values	Daily Returns

Jfrog  vs.  MARTIN MARIETTA MATLS

Jfrog

Risk-Adjusted Performance

OK

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

MARTIN MARIETTA MATLS

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in MARTIN MARIETTA MATLS are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, MARTIN is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Jfrog and MARTIN

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

The idea behind Jfrog and MARTIN MARIETTA MATLS 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.