Correlation Between Gencor Industries and Jewett Cameron

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

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

Diversification Opportunities for Gencor Industries and Jewett Cameron

0.35

Correlation Coefficient

Gencor Industries  Jewett Cameron

Weak diversification

The 3 months correlation between Gencor and Jewett is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Gencor Industries 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 Gencor Industries 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 Gencor Industries 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 Gencor Industries i.e., Gencor Industries and Jewett Cameron go up and down completely randomly.

Pair Corralation between Gencor Industries and Jewett Cameron

If you would invest  2,009  in Gencor Industries on September 13, 2024 and sell it today you would earn a total of  117.00  from holding Gencor Industries or generate 5.82% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	2.33%
Values	Daily Returns

Gencor Industries  vs.  Jewett Cameron Trading

Gencor Industries

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Gencor Industries are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile basic indicators, Gencor Industries may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Jewett Cameron Trading

Risk-Adjusted Performance

0 of 100

Solid

Over the last 90 days Jewett Cameron Trading has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly unfluctuating fundamental indicators, Jewett Cameron reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Gencor Industries and Jewett Cameron

The main advantage of trading using opposite Gencor Industries and Jewett Cameron positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gencor Industries 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 Gencor Industries 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.