Correlation Between Jacobs Solutions and Founder Group

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

By analyzing existing cross correlation between Jacobs Solutions and Founder Group Limited, you can compare the effects of market volatilities on Jacobs Solutions and Founder Group 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 Jacobs Solutions with a short position of Founder Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jacobs Solutions and Founder Group.

Diversification Opportunities for Jacobs Solutions and Founder Group

0.65

Correlation Coefficient

Jacobs Solutions  Founder Group

Poor diversification

The 3 months correlation between Jacobs and Founder is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Jacobs Solutions and Founder Group Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Founder Group Limited and Jacobs Solutions 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 Jacobs Solutions are associated (or correlated) with Founder Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Founder Group Limited has no effect on the direction of Jacobs Solutions i.e., Jacobs Solutions and Founder Group go up and down completely randomly.

Pair Corralation between Jacobs Solutions and Founder Group

Taking into account the 90-day investment horizon Jacobs Solutions is expected to generate 0.12 times more return on investment than Founder Group. However, Jacobs Solutions is 8.61 times less risky than Founder Group. It trades about 0.05 of its potential returns per unit of risk. Founder Group Limited is currently generating about -0.02 per unit of risk. If you would invest  9,350  in Jacobs Solutions on December 27, 2024 and sell it today you would earn a total of  3,047  from holding Jacobs Solutions or generate 32.59% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	21.5%
Values	Daily Returns

Jacobs Solutions  vs.  Founder Group Limited

Jacobs Solutions

Risk-Adjusted Performance

Very Weak

Over the last 90 days Jacobs Solutions has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Stock's forward-looking indicators remain steady and the new chaos on Wall Street may also be a sign of medium-term gains for the company stakeholders.

Founder Group Limited

Risk-Adjusted Performance

Very Weak

Over the last 90 days Founder Group Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Stock's technical and fundamental indicators remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Jacobs Solutions and Founder Group

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

The idea behind Jacobs Solutions and Founder Group Limited 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.