Correlation Between 235825AG1 and Jerash Holdings

Can any of the company-specific risk be diversified away by investing in both 235825AG1 and Jerash Holdings 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 235825AG1 and Jerash Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Dana 5625 percent and Jerash Holdings, you can compare the effects of market volatilities on 235825AG1 and Jerash Holdings 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 235825AG1 with a short position of Jerash Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of 235825AG1 and Jerash Holdings.

Diversification Opportunities for 235825AG1 and Jerash Holdings

0.12

Correlation Coefficient

235825AG1  Jerash Holdings

Average diversification

The 3 months correlation between 235825AG1 and Jerash is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Dana 5625 percent and Jerash Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jerash Holdings and 235825AG1 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 Dana 5625 percent are associated (or correlated) with Jerash Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jerash Holdings has no effect on the direction of 235825AG1 i.e., 235825AG1 and Jerash Holdings go up and down completely randomly.

Pair Corralation between 235825AG1 and Jerash Holdings

Assuming the 90 days trading horizon 235825AG1 is expected to generate 3.34 times less return on investment than Jerash Holdings. But when comparing it to its historical volatility, Dana 5625 percent is 3.15 times less risky than Jerash Holdings. It trades about 0.06 of its potential returns per unit of risk. Jerash Holdings is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  339.00  in Jerash Holdings on December 24, 2024 and sell it today you would earn a total of  18.00  from holding Jerash Holdings or generate 5.31% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.39%
Values	Daily Returns

Dana 5625 percent  vs.  Jerash Holdings

Dana 5625 percent

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Dana 5625 percent are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, 235825AG1 is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Jerash Holdings

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Jerash Holdings are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong basic indicators, Jerash Holdings is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with 235825AG1 and Jerash Holdings

The main advantage of trading using opposite 235825AG1 and Jerash Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 235825AG1 position performs unexpectedly, Jerash Holdings 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 Jerash Holdings will offset losses from the drop in Jerash Holdings' long position.

The idea behind Dana 5625 percent and Jerash 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.