Correlation Between Jacquet Metal and APA
Can any of the company-specific risk be diversified away by investing in both Jacquet Metal and APA 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 Jacquet Metal and APA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jacquet Metal Service and APA Group, you can compare the effects of market volatilities on Jacquet Metal and APA 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 Jacquet Metal with a short position of APA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jacquet Metal and APA.
Diversification Opportunities for Jacquet Metal and APA
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Jacquet and APA is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Jacquet Metal Service and APA Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on APA Group and Jacquet Metal 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 Jacquet Metal Service are associated (or correlated) with APA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of APA Group has no effect on the direction of Jacquet Metal i.e., Jacquet Metal and APA go up and down completely randomly.
Pair Corralation between Jacquet Metal and APA
Assuming the 90 days horizon Jacquet Metal Service is expected to generate 1.46 times more return on investment than APA. However, Jacquet Metal is 1.46 times more volatile than APA Group. It trades about 0.58 of its potential returns per unit of risk. APA Group is currently generating about -0.18 per unit of risk. If you would invest 1,502 in Jacquet Metal Service on November 22, 2024 and sell it today you would earn a total of 298.00 from holding Jacquet Metal Service or generate 19.84% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Jacquet Metal Service vs. APA Group
Performance |
Timeline |
Jacquet Metal Service |
APA Group |
Jacquet Metal and APA Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Jacquet Metal and APA
The main advantage of trading using opposite Jacquet Metal and APA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jacquet Metal position performs unexpectedly, APA 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 APA will offset losses from the drop in APA's long position.Jacquet Metal vs. AGNC INVESTMENT | ||
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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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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