Correlation Between Gen Digital and JRSIS Health

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

By analyzing existing cross correlation between Gen Digital and JRSIS Health Care, you can compare the effects of market volatilities on Gen Digital and JRSIS Health 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 Gen Digital with a short position of JRSIS Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gen Digital and JRSIS Health.

Diversification Opportunities for Gen Digital and JRSIS Health

-0.69

Correlation Coefficient

Gen Digital  JRSIS Health

Excellent diversification

The 3 months correlation between Gen and JRSIS is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Gen Digital and JRSIS Health Care in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JRSIS Health Care and Gen Digital 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 Gen Digital are associated (or correlated) with JRSIS Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JRSIS Health Care has no effect on the direction of Gen Digital i.e., Gen Digital and JRSIS Health go up and down completely randomly.

Pair Corralation between Gen Digital and JRSIS Health

Considering the 90-day investment horizon Gen Digital is expected to under-perform the JRSIS Health. But the stock apears to be less risky and, when comparing its historical volatility, Gen Digital is 11.09 times less risky than JRSIS Health. The stock trades about -0.19 of its potential returns per unit of risk. The JRSIS Health Care is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  12.00  in JRSIS Health Care on September 21, 2024 and sell it today you would earn a total of  3.00  from holding JRSIS Health Care or generate 25.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	95.45%
Values	Daily Returns

Gen Digital  vs.  JRSIS Health Care

Gen Digital

Risk-Adjusted Performance

2 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Gen Digital are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy technical and fundamental indicators, Gen Digital is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

JRSIS Health Care

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days JRSIS Health Care has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest inconsistent performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Gen Digital and JRSIS Health

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

The idea behind Gen Digital and JRSIS Health Care 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.

Check out your portfolio center.

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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.