Correlation Between Jackson Financial and Reliq Health

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Can any of the company-specific risk be diversified away by investing in both Jackson Financial and Reliq Health 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 Jackson Financial and Reliq Health into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jackson Financial and Reliq Health Technologies, you can compare the effects of market volatilities on Jackson Financial and Reliq Health 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 Jackson Financial with a short position of Reliq Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jackson Financial and Reliq Health.

Diversification Opportunities for Jackson Financial and Reliq Health

-0.63
  Correlation Coefficient

Excellent diversification

The 3 months correlation between Jackson and Reliq is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Jackson Financial and Reliq Health Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Reliq Health Technologies and Jackson 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 Jackson Financial are associated (or correlated) with Reliq Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Reliq Health Technologies has no effect on the direction of Jackson Financial i.e., Jackson Financial and Reliq Health go up and down completely randomly.

Pair Corralation between Jackson Financial and Reliq Health

Assuming the 90 days trading horizon Jackson Financial is expected to generate 344.33 times less return on investment than Reliq Health. But when comparing it to its historical volatility, Jackson Financial is 262.87 times less risky than Reliq Health. It trades about 0.11 of its potential returns per unit of risk. Reliq Health Technologies is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  4.00  in Reliq Health Technologies on September 11, 2024 and sell it today you would lose (3.99) from holding Reliq Health Technologies or give up 99.75% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Jackson Financial  vs.  Reliq Health Technologies

 Performance 
       Timeline  
Jackson Financial 

Risk-Adjusted Performance

8 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Jackson Financial are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Jackson Financial is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
Reliq Health Technologies 

Risk-Adjusted Performance

11 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Reliq Health Technologies are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Reliq Health reported solid returns over the last few months and may actually be approaching a breakup point.

Jackson Financial and Reliq Health Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Jackson Financial and Reliq Health

The main advantage of trading using opposite Jackson Financial and Reliq Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jackson Financial position performs unexpectedly, Reliq Health 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 Reliq Health will offset losses from the drop in Reliq Health's long position.
The idea behind Jackson Financial and Reliq Health 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.
Check out your portfolio center.
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.

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