Correlation Between Jade Gas and AMOTIV

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Can any of the company-specific risk be diversified away by investing in both Jade Gas and AMOTIV 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 Jade Gas and AMOTIV into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jade Gas Holdings and AMOTIV LTD, you can compare the effects of market volatilities on Jade Gas and AMOTIV 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 Jade Gas with a short position of AMOTIV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jade Gas and AMOTIV.

Diversification Opportunities for Jade Gas and AMOTIV

0.03
  Correlation Coefficient

Significant diversification

The 3 months correlation between Jade and AMOTIV is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Jade Gas Holdings and AMOTIV LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMOTIV LTD and Jade Gas 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 Jade Gas Holdings are associated (or correlated) with AMOTIV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMOTIV LTD has no effect on the direction of Jade Gas i.e., Jade Gas and AMOTIV go up and down completely randomly.

Pair Corralation between Jade Gas and AMOTIV

Assuming the 90 days trading horizon Jade Gas is expected to generate 1.03 times less return on investment than AMOTIV. In addition to that, Jade Gas is 2.92 times more volatile than AMOTIV LTD. It trades about 0.01 of its total potential returns per unit of risk. AMOTIV LTD is currently generating about 0.03 per unit of volatility. If you would invest  890.00  in AMOTIV LTD on October 4, 2024 and sell it today you would earn a total of  168.00  from holding AMOTIV LTD or generate 18.88% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Jade Gas Holdings  vs.  AMOTIV LTD

 Performance 
       Timeline  
Jade Gas Holdings 

Risk-Adjusted Performance

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Weak
 
Strong
Very Weak
Over the last 90 days Jade Gas Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable technical indicators, Jade Gas is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.
AMOTIV LTD 

Risk-Adjusted Performance

5 of 100

 
Weak
 
Strong
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in AMOTIV LTD are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, AMOTIV may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Jade Gas and AMOTIV Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Jade Gas and AMOTIV

The main advantage of trading using opposite Jade Gas and AMOTIV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jade Gas position performs unexpectedly, AMOTIV 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 AMOTIV will offset losses from the drop in AMOTIV's long position.
The idea behind Jade Gas Holdings and AMOTIV LTD 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.

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