Correlation Between JFL Living and Hsi Malls

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

By analyzing existing cross correlation between JFL Living Fundo and Hsi Malls Fundo, you can compare the effects of market volatilities on JFL Living and Hsi Malls 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 JFL Living with a short position of Hsi Malls. Check out your portfolio center. Please also check ongoing floating volatility patterns of JFL Living and Hsi Malls.

Diversification Opportunities for JFL Living and Hsi Malls

0.24

Correlation Coefficient

JFL Living  Hsi Malls

Modest diversification

The 3 months correlation between JFL and Hsi is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding JFL Living Fundo and Hsi Malls Fundo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hsi Malls Fundo and JFL Living 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 JFL Living Fundo are associated (or correlated) with Hsi Malls. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hsi Malls Fundo has no effect on the direction of JFL Living i.e., JFL Living and Hsi Malls go up and down completely randomly.

Pair Corralation between JFL Living and Hsi Malls

Assuming the 90 days trading horizon JFL Living Fundo is expected to under-perform the Hsi Malls. In addition to that, JFL Living is 1.36 times more volatile than Hsi Malls Fundo. It trades about -0.04 of its total potential returns per unit of risk. Hsi Malls Fundo is currently generating about 0.23 per unit of volatility. If you would invest  7,166  in Hsi Malls Fundo on December 30, 2024 and sell it today you would earn a total of  1,153  from holding Hsi Malls Fundo or generate 16.09% return on investment over 90 days.

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

JFL Living Fundo  vs.  Hsi Malls Fundo

JFL Living Fundo

Risk-Adjusted Performance

Very Weak

Over the last 90 days JFL Living Fundo has generated negative risk-adjusted returns adding no value to fund investors. Despite somewhat strong essential indicators, JFL Living is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Hsi Malls Fundo

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Hsi Malls Fundo are ranked lower than 17 (%) of all funds and portfolios of funds over the last 90 days. Despite somewhat weak primary indicators, Hsi Malls sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with JFL Living and Hsi Malls

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

The idea behind JFL Living Fundo and Hsi Malls Fundo 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.