Correlation Between JX Luxventure and Neo Concept

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

By analyzing existing cross correlation between JX Luxventure Limited and Neo Concept International Group, you can compare the effects of market volatilities on JX Luxventure and Neo Concept 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 JX Luxventure with a short position of Neo Concept. Check out your portfolio center. Please also check ongoing floating volatility patterns of JX Luxventure and Neo Concept.

Diversification Opportunities for JX Luxventure and Neo Concept

0.14

Correlation Coefficient

JX Luxventure  Neo Concept

Average diversification

The 3 months correlation between JXG and Neo is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding JX Luxventure Limited and Neo Concept International Grou in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Neo Concept Internat and JX Luxventure 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 JX Luxventure Limited are associated (or correlated) with Neo Concept. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Neo Concept Internat has no effect on the direction of JX Luxventure i.e., JX Luxventure and Neo Concept go up and down completely randomly.

Pair Corralation between JX Luxventure and Neo Concept

Considering the 90-day investment horizon JX Luxventure Limited is expected to generate 4.97 times more return on investment than Neo Concept. However, JX Luxventure is 4.97 times more volatile than Neo Concept International Group. It trades about 0.12 of its potential returns per unit of risk. Neo Concept International Group is currently generating about -0.06 per unit of risk. If you would invest  84.00  in JX Luxventure Limited on December 17, 2024 and sell it today you would earn a total of  139.00  from holding JX Luxventure Limited or generate 165.48% return on investment over 90 days.

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

JX Luxventure Limited  vs.  Neo Concept International Grou

JX Luxventure Limited

Risk-Adjusted Performance

OK

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

Neo Concept Internat

Risk-Adjusted Performance

Very Weak

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

Pair Trading with JX Luxventure and Neo Concept

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

The idea behind JX Luxventure Limited and Neo Concept International Group 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.