Correlation Between Jacobs Solutions and Mistras
Can any of the company-specific risk be diversified away by investing in both Jacobs Solutions and Mistras 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 Jacobs Solutions and Mistras into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jacobs Solutions and Mistras Group, you can compare the effects of market volatilities on Jacobs Solutions and Mistras 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 Jacobs Solutions with a short position of Mistras. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jacobs Solutions and Mistras.
Diversification Opportunities for Jacobs Solutions and Mistras
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Jacobs and Mistras is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Jacobs Solutions and Mistras Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mistras Group and Jacobs Solutions 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 Jacobs Solutions are associated (or correlated) with Mistras. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mistras Group has no effect on the direction of Jacobs Solutions i.e., Jacobs Solutions and Mistras go up and down completely randomly.
Pair Corralation between Jacobs Solutions and Mistras
Taking into account the 90-day investment horizon Jacobs Solutions is expected to generate 0.41 times more return on investment than Mistras. However, Jacobs Solutions is 2.45 times less risky than Mistras. It trades about 0.15 of its potential returns per unit of risk. Mistras Group is currently generating about -0.06 per unit of risk. If you would invest 12,261 in Jacobs Solutions on September 1, 2024 and sell it today you would earn a total of 1,862 from holding Jacobs Solutions or generate 15.19% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Jacobs Solutions vs. Mistras Group
Performance |
Timeline |
Jacobs Solutions |
Mistras Group |
Jacobs Solutions and Mistras Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Jacobs Solutions and Mistras
The main advantage of trading using opposite Jacobs Solutions and Mistras positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jacobs Solutions position performs unexpectedly, Mistras 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 Mistras will offset losses from the drop in Mistras' long position.Jacobs Solutions vs. KBR Inc | Jacobs Solutions vs. Tetra Tech | Jacobs Solutions vs. Fluor | Jacobs Solutions vs. Topbuild Corp |
Mistras vs. Team Inc | Mistras vs. Thermon Group Holdings | Mistras vs. MRC Global | Mistras vs. Vishay Precision Group |
Check out your portfolio center.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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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