Correlation Between Jutal Offshore and Spectral

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

By analyzing existing cross correlation between Jutal Offshore Oil and Spectral AI, you can compare the effects of market volatilities on Jutal Offshore and Spectral 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 Jutal Offshore with a short position of Spectral. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jutal Offshore and Spectral.

Diversification Opportunities for Jutal Offshore and Spectral

0.69

Correlation Coefficient

Jutal Offshore  Spectral

Poor diversification

The 3 months correlation between Jutal and Spectral is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Jutal Offshore Oil and Spectral AI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Spectral AI and Jutal Offshore 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 Jutal Offshore Oil are associated (or correlated) with Spectral. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Spectral AI has no effect on the direction of Jutal Offshore i.e., Jutal Offshore and Spectral go up and down completely randomly.

Pair Corralation between Jutal Offshore and Spectral

Assuming the 90 days horizon Jutal Offshore is expected to generate 2.32 times less return on investment than Spectral. But when comparing it to its historical volatility, Jutal Offshore Oil is 3.44 times less risky than Spectral. It trades about 0.08 of its potential returns per unit of risk. Spectral AI is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  170.00  in Spectral AI on October 25, 2024 and sell it today you would earn a total of  32.00  from holding Spectral AI or generate 18.82% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	97.62%
Values	Daily Returns

Jutal Offshore Oil  vs.  Spectral AI

Jutal Offshore Oil

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Jutal Offshore Oil are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unsteady basic indicators, Jutal Offshore may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Spectral AI

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Spectral AI are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite fairly unfluctuating basic indicators, Spectral demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Jutal Offshore and Spectral

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

The idea behind Jutal Offshore Oil and Spectral AI 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.