Correlation Between Jones Lang and MDJM

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

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

Diversification Opportunities for Jones Lang and MDJM

-0.02

Correlation Coefficient

Jones Lang  MDJM

Good diversification

The 3 months correlation between Jones and MDJM is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Jones Lang LaSalle and MDJM in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MDJM and Jones Lang 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 Jones Lang LaSalle are associated (or correlated) with MDJM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MDJM has no effect on the direction of Jones Lang i.e., Jones Lang and MDJM go up and down completely randomly.

Pair Corralation between Jones Lang and MDJM

Considering the 90-day investment horizon Jones Lang LaSalle is expected to generate 0.26 times more return on investment than MDJM. However, Jones Lang LaSalle is 3.85 times less risky than MDJM. It trades about 0.04 of its potential returns per unit of risk. MDJM is currently generating about -0.01 per unit of risk. If you would invest  17,716  in Jones Lang LaSalle on October 4, 2024 and sell it today you would earn a total of  7,215  from holding Jones Lang LaSalle or generate 40.73% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	99.6%
Values	Daily Returns

Jones Lang LaSalle  vs.  MDJM

Jones Lang LaSalle

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Jones Lang LaSalle has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent essential indicators, Jones Lang is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

MDJM

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days MDJM has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's forward-looking indicators remain fairly strong which may send shares a bit higher in February 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pair Trading with Jones Lang and MDJM

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

The idea behind Jones Lang LaSalle and MDJM 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.