Correlation Between Jeffs Brands and Nocera

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

By analyzing existing cross correlation between Jeffs Brands and Nocera Inc, you can compare the effects of market volatilities on Jeffs Brands and Nocera 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 Jeffs Brands with a short position of Nocera. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jeffs Brands and Nocera.

Diversification Opportunities for Jeffs Brands and Nocera

-0.41

Correlation Coefficient

Jeffs Brands  Nocera

Very good diversification

The 3 months correlation between Jeffs and Nocera is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Jeffs Brands and Nocera Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nocera Inc and Jeffs Brands 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 Jeffs Brands are associated (or correlated) with Nocera. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nocera Inc has no effect on the direction of Jeffs Brands i.e., Jeffs Brands and Nocera go up and down completely randomly.

Pair Corralation between Jeffs Brands and Nocera

Given the investment horizon of 90 days Jeffs Brands is expected to generate 15.21 times more return on investment than Nocera. However, Jeffs Brands is 15.21 times more volatile than Nocera Inc. It trades about 0.13 of its potential returns per unit of risk. Nocera Inc is currently generating about 0.03 per unit of risk. If you would invest  20.00  in Jeffs Brands on September 15, 2024 and sell it today you would earn a total of  246.00  from holding Jeffs Brands or generate 1230.0% return on investment over 90 days.

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

Jeffs Brands  vs.  Nocera Inc

Jeffs Brands

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Jeffs Brands are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Even with relatively unfluctuating fundamental drivers, Jeffs Brands reported solid returns over the last few months and may actually be approaching a breakup point.

Nocera Inc

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Nocera Inc are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Nocera sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Jeffs Brands and Nocera

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

The idea behind Jeffs Brands and Nocera Inc 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.