Correlation Between Synovus Financial and Jacquet Metal

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

By analyzing existing cross correlation between Synovus Financial Corp and Jacquet Metal Service, you can compare the effects of market volatilities on Synovus Financial and Jacquet Metal 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 Synovus Financial with a short position of Jacquet Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Synovus Financial and Jacquet Metal.

Diversification Opportunities for Synovus Financial and Jacquet Metal

-0.32

Correlation Coefficient

Synovus Financial  Jacquet Metal

Very good diversification

The 3 months correlation between Synovus and Jacquet is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Synovus Financial Corp and Jacquet Metal Service in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jacquet Metal Service and Synovus 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 Synovus Financial Corp are associated (or correlated) with Jacquet Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jacquet Metal Service has no effect on the direction of Synovus Financial i.e., Synovus Financial and Jacquet Metal go up and down completely randomly.

Pair Corralation between Synovus Financial and Jacquet Metal

Assuming the 90 days trading horizon Synovus Financial Corp is expected to generate 1.23 times more return on investment than Jacquet Metal. However, Synovus Financial is 1.23 times more volatile than Jacquet Metal Service. It trades about 0.13 of its potential returns per unit of risk. Jacquet Metal Service is currently generating about -0.08 per unit of risk. If you would invest  4,565  in Synovus Financial Corp on October 26, 2024 and sell it today you would earn a total of  735.00  from holding Synovus Financial Corp or generate 16.1% return on investment over 90 days.

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

Synovus Financial Corp  vs.  Jacquet Metal Service

Synovus Financial Corp

Risk-Adjusted Performance

9 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Synovus Financial Corp are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Synovus Financial unveiled solid returns over the last few months and may actually be approaching a breakup point.

Jacquet Metal Service

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Jacquet Metal Service has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with Synovus Financial and Jacquet Metal

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

The idea behind Synovus Financial Corp and Jacquet Metal Service 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.