Correlation Between Jaguar Animal and Silo Pharma

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

By analyzing existing cross correlation between Jaguar Animal Health and Silo Pharma, you can compare the effects of market volatilities on Jaguar Animal and Silo Pharma 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 Jaguar Animal with a short position of Silo Pharma. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jaguar Animal and Silo Pharma.

Diversification Opportunities for Jaguar Animal and Silo Pharma

0.33

Correlation Coefficient

Jaguar Animal  Silo Pharma

Weak diversification

The 3 months correlation between Jaguar and Silo is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Jaguar Animal Health and Silo Pharma in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Silo Pharma and Jaguar Animal 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 Jaguar Animal Health are associated (or correlated) with Silo Pharma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Silo Pharma has no effect on the direction of Jaguar Animal i.e., Jaguar Animal and Silo Pharma go up and down completely randomly.

Pair Corralation between Jaguar Animal and Silo Pharma

Given the investment horizon of 90 days Jaguar Animal Health is expected to under-perform the Silo Pharma. In addition to that, Jaguar Animal is 1.24 times more volatile than Silo Pharma. It trades about -0.03 of its total potential returns per unit of risk. Silo Pharma is currently generating about -0.02 per unit of volatility. If you would invest  110.00  in Silo Pharma on September 30, 2024 and sell it today you would lose (16.00) from holding Silo Pharma or give up 14.55% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Jaguar Animal Health  vs.  Silo Pharma

Jaguar Animal Health

Risk-Adjusted Performance

0 of 100

Very Weak

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

Silo Pharma

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Silo Pharma has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Stock's essential indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Pair Trading with Jaguar Animal and Silo Pharma

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

The idea behind Jaguar Animal Health and Silo Pharma 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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.