Correlation Between Vince Holding and J Long

Can any of the company-specific risk be diversified away by investing in both Vince Holding and J Long 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 Vince Holding and J Long into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Vince Holding Corp and J Long Group Limited, you can compare the effects of market volatilities on Vince Holding and J Long 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 Vince Holding with a short position of J Long. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vince Holding and J Long.

Diversification Opportunities for Vince Holding and J Long

-0.04

Correlation Coefficient

Vince Holding  J Long

Good diversification

The 3 months correlation between Vince and J Long is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Vince Holding Corp and J Long Group Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on J Long Group and Vince Holding 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 Vince Holding Corp are associated (or correlated) with J Long. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of J Long Group has no effect on the direction of Vince Holding i.e., Vince Holding and J Long go up and down completely randomly.

Pair Corralation between Vince Holding and J Long

Given the investment horizon of 90 days Vince Holding Corp is expected to generate 4.08 times more return on investment than J Long. However, Vince Holding is 4.08 times more volatile than J Long Group Limited. It trades about 0.26 of its potential returns per unit of risk. J Long Group Limited is currently generating about 0.38 per unit of risk. If you would invest  190.00  in Vince Holding Corp on October 9, 2024 and sell it today you would earn a total of  231.00  from holding Vince Holding Corp or generate 121.58% return on investment over 90 days.

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

Vince Holding Corp  vs.  J Long Group Limited

Vince Holding Corp

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Vince Holding Corp are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating fundamental indicators, Vince Holding exhibited solid returns over the last few months and may actually be approaching a breakup point.

J Long Group

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in J Long Group Limited are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite quite unfluctuating essential indicators, J Long disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Vince Holding and J Long

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

The idea behind Vince Holding Corp and J Long Group Limited 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.