Correlation Between Jacquet Metal and Dolfines SAS

Can any of the company-specific risk be diversified away by investing in both Jacquet Metal and Dolfines SAS 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 Jacquet Metal and Dolfines SAS into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Jacquet Metal Service and Dolfines SAS, you can compare the effects of market volatilities on Jacquet Metal and Dolfines SAS 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 Jacquet Metal with a short position of Dolfines SAS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jacquet Metal and Dolfines SAS.

Diversification Opportunities for Jacquet Metal and Dolfines SAS

-0.21

Correlation Coefficient

Jacquet Metal  Dolfines SAS

Very good diversification

The 3 months correlation between Jacquet and Dolfines is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Jacquet Metal Service and Dolfines SAS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dolfines SAS and Jacquet Metal 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 Jacquet Metal Service are associated (or correlated) with Dolfines SAS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dolfines SAS has no effect on the direction of Jacquet Metal i.e., Jacquet Metal and Dolfines SAS go up and down completely randomly.

Pair Corralation between Jacquet Metal and Dolfines SAS

Assuming the 90 days trading horizon Jacquet Metal is expected to generate 5.75 times less return on investment than Dolfines SAS. But when comparing it to its historical volatility, Jacquet Metal Service is 4.17 times less risky than Dolfines SAS. It trades about 0.12 of its potential returns per unit of risk. Dolfines SAS is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest  141.00  in Dolfines SAS on December 29, 2024 and sell it today you would earn a total of  159.00  from holding Dolfines SAS or generate 112.77% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.46%
Values	Daily Returns

Jacquet Metal Service  vs.  Dolfines SAS

Jacquet Metal Service

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Jacquet Metal Service are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Jacquet Metal sustained solid returns over the last few months and may actually be approaching a breakup point.

Dolfines SAS

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Dolfines SAS are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Dolfines SAS reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Jacquet Metal and Dolfines SAS

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

The idea behind Jacquet Metal Service and Dolfines SAS 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.

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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.