Correlation Between JM Financial and 63 Moons

Can any of the company-specific risk be diversified away by investing in both JM Financial and 63 Moons 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 JM Financial and 63 Moons into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between JM Financial Limited and 63 moons technologies, you can compare the effects of market volatilities on JM Financial and 63 Moons 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 JM Financial with a short position of 63 Moons. Check out your portfolio center. Please also check ongoing floating volatility patterns of JM Financial and 63 Moons.

Diversification Opportunities for JM Financial and 63 Moons

-0.51

Correlation Coefficient

JM Financial  63 Moons

Excellent diversification

The 3 months correlation between JMFINANCIL and 63MOONS is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding JM Financial Limited and 63 moons technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 63 moons technologies and JM Financial 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 JM Financial Limited are associated (or correlated) with 63 Moons. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 63 moons technologies has no effect on the direction of JM Financial i.e., JM Financial and 63 Moons go up and down completely randomly.

Pair Corralation between JM Financial and 63 Moons

Assuming the 90 days trading horizon JM Financial Limited is expected to under-perform the 63 Moons. But the stock apears to be less risky and, when comparing its historical volatility, JM Financial Limited is 1.58 times less risky than 63 Moons. The stock trades about -0.35 of its potential returns per unit of risk. The 63 moons technologies is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  87,175  in 63 moons technologies on October 13, 2024 and sell it today you would lose (1,400) from holding 63 moons technologies or give up 1.61% of portfolio value over 90 days.

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

JM Financial Limited  vs.  63 moons technologies

JM Financial Limited

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days JM Financial Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's fundamental indicators remain very healthy which may send shares a bit higher in February 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

63 moons technologies

Risk-Adjusted Performance

19 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in 63 moons technologies are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, 63 Moons unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with JM Financial and 63 Moons

The main advantage of trading using opposite JM Financial and 63 Moons positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JM Financial position performs unexpectedly, 63 Moons 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 63 Moons will offset losses from the drop in 63 Moons' long position.

The idea behind JM Financial Limited and 63 moons technologies 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 Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .