Correlation Between JBDI Holdings and Videolocity International

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

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

Diversification Opportunities for JBDI Holdings and Videolocity International

0.0

Correlation Coefficient

JBDI Holdings  Videolocity International

Pay attention - limited upside

The 3 months correlation between JBDI and Videolocity is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding JBDI Holdings Limited and Videolocity International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Videolocity International and JBDI 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 JBDI Holdings Limited are associated (or correlated) with Videolocity International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Videolocity International has no effect on the direction of JBDI Holdings i.e., JBDI Holdings and Videolocity International go up and down completely randomly.

Pair Corralation between JBDI Holdings and Videolocity International

If you would invest  58.00  in JBDI Holdings Limited on December 22, 2024 and sell it today you would earn a total of  17.00  from holding JBDI Holdings Limited or generate 29.31% return on investment over 90 days.

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

JBDI Holdings Limited  vs.  Videolocity International

JBDI Holdings Limited

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in JBDI Holdings Limited are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak fundamental indicators, JBDI Holdings demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Videolocity International

Risk-Adjusted Performance

Very Weak

Over the last 90 days Videolocity International has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Videolocity International is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with JBDI Holdings and Videolocity International

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

The idea behind JBDI Holdings Limited and Videolocity International 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.