Correlation Between Progate and Jetwell Computer

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

By analyzing existing cross correlation between Progate Group and Jetwell Computer Co, you can compare the effects of market volatilities on Progate and Jetwell Computer 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 Progate with a short position of Jetwell Computer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Progate and Jetwell Computer.

Diversification Opportunities for Progate and Jetwell Computer

0.83

Correlation Coefficient

Progate  Jetwell Computer

Very poor diversification

The 3 months correlation between Progate and Jetwell is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Progate Group and Jetwell Computer Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jetwell Computer and Progate 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 Progate Group are associated (or correlated) with Jetwell Computer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jetwell Computer has no effect on the direction of Progate i.e., Progate and Jetwell Computer go up and down completely randomly.

Pair Corralation between Progate and Jetwell Computer

Assuming the 90 days trading horizon Progate Group is expected to under-perform the Jetwell Computer. In addition to that, Progate is 1.06 times more volatile than Jetwell Computer Co. It trades about -0.13 of its total potential returns per unit of risk. Jetwell Computer Co is currently generating about -0.11 per unit of volatility. If you would invest  16,300  in Jetwell Computer Co on September 2, 2024 and sell it today you would lose (3,000) from holding Jetwell Computer Co or give up 18.4% of portfolio value over 90 days.

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

Progate Group  vs.  Jetwell Computer Co

Progate Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Progate Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in January 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Jetwell Computer

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Jetwell Computer Co has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in January 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with Progate and Jetwell Computer

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

The idea behind Progate Group and Jetwell Computer Co 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.