Correlation Between JPX Global and Church Crawford

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

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

Diversification Opportunities for JPX Global and Church Crawford

-0.39

Correlation Coefficient

JPX Global  Church Crawford

Very good diversification

The 3 months correlation between JPX and Church is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding JPX Global and Church Crawford in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Church Crawford and JPX Global 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 JPX Global are associated (or correlated) with Church Crawford. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Church Crawford has no effect on the direction of JPX Global i.e., JPX Global and Church Crawford go up and down completely randomly.

Pair Corralation between JPX Global and Church Crawford

Given the investment horizon of 90 days JPX Global is expected to generate 2.45 times more return on investment than Church Crawford. However, JPX Global is 2.45 times more volatile than Church Crawford. It trades about 0.15 of its potential returns per unit of risk. Church Crawford is currently generating about 0.07 per unit of risk. If you would invest  0.01  in JPX Global on September 13, 2024 and sell it today you would earn a total of  0.00  from holding JPX Global or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

JPX Global  vs.  Church Crawford

JPX Global

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in JPX Global are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak technical and fundamental indicators, JPX Global showed solid returns over the last few months and may actually be approaching a breakup point.

Church Crawford

Risk-Adjusted Performance

5 of 100

Modest

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

Pair Trading with JPX Global and Church Crawford

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

The idea behind JPX Global and Church Crawford 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.