Correlation Between Jourdan Resources and Cypress Development

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

By analyzing existing cross correlation between Jourdan Resources and Cypress Development Corp, you can compare the effects of market volatilities on Jourdan Resources and Cypress Development 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 Jourdan Resources with a short position of Cypress Development. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jourdan Resources and Cypress Development.

Diversification Opportunities for Jourdan Resources and Cypress Development

0.19

Correlation Coefficient

Jourdan Resources  Cypress Development

Average diversification

The 3 months correlation between Jourdan and Cypress is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Jourdan Resources and Cypress Development Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cypress Development Corp and Jourdan Resources 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 Jourdan Resources are associated (or correlated) with Cypress Development. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cypress Development Corp has no effect on the direction of Jourdan Resources i.e., Jourdan Resources and Cypress Development go up and down completely randomly.

Pair Corralation between Jourdan Resources and Cypress Development

Assuming the 90 days horizon Jourdan Resources is expected to generate 3.57 times more return on investment than Cypress Development. However, Jourdan Resources is 3.57 times more volatile than Cypress Development Corp. It trades about 0.08 of its potential returns per unit of risk. Cypress Development Corp is currently generating about 0.03 per unit of risk. If you would invest  1.14  in Jourdan Resources on September 1, 2024 and sell it today you would lose (0.20) from holding Jourdan Resources or give up 17.54% of portfolio value over 90 days.

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

Jourdan Resources  vs.  Cypress Development Corp

Jourdan Resources

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Jourdan Resources are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile technical and fundamental indicators, Jourdan Resources reported solid returns over the last few months and may actually be approaching a breakup point.

Cypress Development Corp

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Cypress Development Corp are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Cypress Development may actually be approaching a critical reversion point that can send shares even higher in December 2024.

Pair Trading with Jourdan Resources and Cypress Development

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

The idea behind Jourdan Resources and Cypress Development Corp 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.