Correlation Between Jabil Circuit and Bt Brands
Can any of the company-specific risk be diversified away by investing in both Jabil Circuit and Bt Brands 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 Jabil Circuit and Bt Brands into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jabil Circuit and Bt Brands, you can compare the effects of market volatilities on Jabil Circuit and Bt Brands 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 Jabil Circuit with a short position of Bt Brands. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jabil Circuit and Bt Brands.
Diversification Opportunities for Jabil Circuit and Bt Brands
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Jabil and BTBD is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Jabil Circuit and Bt Brands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bt Brands and Jabil Circuit 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 Jabil Circuit are associated (or correlated) with Bt Brands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bt Brands has no effect on the direction of Jabil Circuit i.e., Jabil Circuit and Bt Brands go up and down completely randomly.
Pair Corralation between Jabil Circuit and Bt Brands
Considering the 90-day investment horizon Jabil Circuit is expected to generate 0.4 times more return on investment than Bt Brands. However, Jabil Circuit is 2.51 times less risky than Bt Brands. It trades about 0.07 of its potential returns per unit of risk. Bt Brands is currently generating about 0.03 per unit of risk. If you would invest 6,854 in Jabil Circuit on September 15, 2024 and sell it today you would earn a total of 6,659 from holding Jabil Circuit or generate 97.15% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Jabil Circuit vs. Bt Brands
Performance |
Timeline |
Jabil Circuit |
Bt Brands |
Jabil Circuit and Bt Brands Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Jabil Circuit and Bt Brands
The main advantage of trading using opposite Jabil Circuit and Bt Brands positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jabil Circuit position performs unexpectedly, Bt Brands 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 Bt Brands will offset losses from the drop in Bt Brands' long position.Jabil Circuit vs. Quantum Computing | Jabil Circuit vs. IONQ Inc | Jabil Circuit vs. Quantum | Jabil Circuit vs. Super Micro Computer |
Check out your portfolio center.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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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