Correlation Between ISign Media and Jamieson Wellness

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

By analyzing existing cross correlation between iSign Media Solutions and Jamieson Wellness, you can compare the effects of market volatilities on ISign Media and Jamieson Wellness 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 ISign Media with a short position of Jamieson Wellness. Check out your portfolio center. Please also check ongoing floating volatility patterns of ISign Media and Jamieson Wellness.

Diversification Opportunities for ISign Media and Jamieson Wellness

-0.07

Correlation Coefficient

ISign Media  Jamieson Wellness

Good diversification

The 3 months correlation between ISign and Jamieson is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding iSign Media Solutions and Jamieson Wellness in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jamieson Wellness and ISign Media 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 iSign Media Solutions are associated (or correlated) with Jamieson Wellness. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jamieson Wellness has no effect on the direction of ISign Media i.e., ISign Media and Jamieson Wellness go up and down completely randomly.

Pair Corralation between ISign Media and Jamieson Wellness

Assuming the 90 days horizon iSign Media Solutions is expected to under-perform the Jamieson Wellness. But the stock apears to be less risky and, when comparing its historical volatility, iSign Media Solutions is 1.91 times less risky than Jamieson Wellness. The stock trades about -0.08 of its potential returns per unit of risk. The Jamieson Wellness is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  3,339  in Jamieson Wellness on September 22, 2024 and sell it today you would earn a total of  395.00  from holding Jamieson Wellness or generate 11.83% return on investment over 90 days.

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

iSign Media Solutions  vs.  Jamieson Wellness

iSign Media Solutions

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days iSign Media Solutions has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, ISign Media is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Jamieson Wellness

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Jamieson Wellness are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Jamieson Wellness may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with ISign Media and Jamieson Wellness

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

The idea behind iSign Media Solutions and Jamieson Wellness 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.