Correlation Between IES Holdings and JNS Holdings

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

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

Diversification Opportunities for IES Holdings and JNS Holdings

-0.28

Correlation Coefficient

IES Holdings  JNS Holdings

Very good diversification

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

Pair Corralation between IES Holdings and JNS Holdings

Given the investment horizon of 90 days IES Holdings is expected to generate 1.41 times more return on investment than JNS Holdings. However, IES Holdings is 1.41 times more volatile than JNS Holdings Corp. It trades about 0.29 of its potential returns per unit of risk. JNS Holdings Corp is currently generating about 0.07 per unit of risk. If you would invest  21,799  in IES Holdings on October 26, 2024 and sell it today you would earn a total of  7,111  from holding IES Holdings or generate 32.62% return on investment over 90 days.

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

IES Holdings  vs.  JNS Holdings Corp

IES Holdings

Risk-Adjusted Performance

10 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in IES Holdings are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, IES Holdings exhibited solid returns over the last few months and may actually be approaching a breakup point.

JNS Holdings Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days JNS Holdings Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, JNS Holdings is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with IES Holdings and JNS Holdings

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

The idea behind IES Holdings and JNS Holdings Corp 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 Valuation module to check real value of public entities based on technical and fundamental data.