Correlation Between Small Pany and Jacob Internet

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

By analyzing existing cross correlation between Small Pany Growth and Jacob Internet Fund, you can compare the effects of market volatilities on Small Pany and Jacob Internet 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 Small Pany with a short position of Jacob Internet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Small Pany and Jacob Internet.

Diversification Opportunities for Small Pany and Jacob Internet

0.99

Correlation Coefficient

Small Pany  Jacob Internet

No risk reduction

The 3 months correlation between Small and Jacob is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Small Pany Growth and Jacob Internet Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jacob Internet and Small Pany 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 Small Pany Growth are associated (or correlated) with Jacob Internet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jacob Internet has no effect on the direction of Small Pany i.e., Small Pany and Jacob Internet go up and down completely randomly.

Pair Corralation between Small Pany and Jacob Internet

Assuming the 90 days horizon Small Pany Growth is expected to generate 1.09 times more return on investment than Jacob Internet. However, Small Pany is 1.09 times more volatile than Jacob Internet Fund. It trades about 0.32 of its potential returns per unit of risk. Jacob Internet Fund is currently generating about 0.27 per unit of risk. If you would invest  782.00  in Small Pany Growth on September 16, 2024 and sell it today you would earn a total of  327.00  from holding Small Pany Growth or generate 41.82% return on investment over 90 days.

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

Small Pany Growth  vs.  Jacob Internet Fund

Small Pany Growth

Risk-Adjusted Performance

25 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Small Pany Growth are ranked lower than 25 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak primary indicators, Small Pany showed solid returns over the last few months and may actually be approaching a breakup point.

Jacob Internet

Risk-Adjusted Performance

21 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Jacob Internet Fund are ranked lower than 21 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical and fundamental indicators, Jacob Internet showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Small Pany and Jacob Internet

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

The idea behind Small Pany Growth and Jacob Internet Fund 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.