Correlation Between Jackson Financial and SNM Gobal

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

By analyzing existing cross correlation between Jackson Financial and SNM Gobal Holdings, you can compare the effects of market volatilities on Jackson Financial and SNM Gobal 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 SNM Gobal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jackson Financial and SNM Gobal.

Diversification Opportunities for Jackson Financial and SNM Gobal

0.0

Correlation Coefficient

Jackson Financial  SNM Gobal

Pay attention - limited upside

The 3 months correlation between Jackson and SNM is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Jackson Financial and SNM Gobal Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SNM Gobal Holdings 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 SNM Gobal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SNM Gobal Holdings has no effect on the direction of Jackson Financial i.e., Jackson Financial and SNM Gobal go up and down completely randomly.

Pair Corralation between Jackson Financial and SNM Gobal

Assuming the 90 days trading horizon Jackson Financial is expected to generate 46.92 times less return on investment than SNM Gobal. But when comparing it to its historical volatility, Jackson Financial is 23.75 times less risky than SNM Gobal. It trades about 0.05 of its potential returns per unit of risk. SNM Gobal Holdings is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  0.05  in SNM Gobal Holdings on September 5, 2024 and sell it today you would lose (0.04) from holding SNM Gobal Holdings or give up 80.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	89.47%
Values	Daily Returns

Jackson Financial  vs.  SNM Gobal Holdings

Jackson Financial

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Jackson Financial are ranked lower than 9 (%) 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.

SNM Gobal Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SNM Gobal Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy primary indicators, SNM Gobal is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Jackson Financial and SNM Gobal

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

The idea behind Jackson Financial and SNM Gobal Holdings 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..