Correlation Between Jefferies Financial and FDO INV

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

By analyzing existing cross correlation between Jefferies Financial Group and FDO INV IMOB, you can compare the effects of market volatilities on Jefferies Financial and FDO INV 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 Jefferies Financial with a short position of FDO INV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jefferies Financial and FDO INV.

Diversification Opportunities for Jefferies Financial and FDO INV

-0.91

Correlation Coefficient

Jefferies Financial  FDO INV

Pay attention - limited upside

The 3 months correlation between Jefferies and FDO is -0.91. Overlapping area represents the amount of risk that can be diversified away by holding Jefferies Financial Group and FDO INV IMOB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FDO INV IMOB and Jefferies Financial 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 Jefferies Financial Group are associated (or correlated) with FDO INV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FDO INV IMOB has no effect on the direction of Jefferies Financial i.e., Jefferies Financial and FDO INV go up and down completely randomly.

Pair Corralation between Jefferies Financial and FDO INV

Assuming the 90 days trading horizon Jefferies Financial Group is expected to under-perform the FDO INV. In addition to that, Jefferies Financial is 19.19 times more volatile than FDO INV IMOB. It trades about -0.23 of its total potential returns per unit of risk. FDO INV IMOB is currently generating about 0.26 per unit of volatility. If you would invest  141,345  in FDO INV IMOB on December 24, 2024 and sell it today you would earn a total of  2,905  from holding FDO INV IMOB or generate 2.06% return on investment over 90 days.

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

Jefferies Financial Group  vs.  FDO INV IMOB

Jefferies Financial

Risk-Adjusted Performance

Very Weak

Over the last 90 days Jefferies Financial Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's technical and fundamental indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

FDO INV IMOB

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in FDO INV IMOB are ranked lower than 20 (%) of all funds and portfolios of funds over the last 90 days. Despite somewhat strong basic indicators, FDO INV is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Jefferies Financial and FDO INV

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

The idea behind Jefferies Financial Group and FDO INV IMOB 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.