Correlation Between Jack Henry and ASGN

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

By analyzing existing cross correlation between Jack Henry Associates and ASGN Inc, you can compare the effects of market volatilities on Jack Henry and ASGN 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 Jack Henry with a short position of ASGN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jack Henry and ASGN.

Diversification Opportunities for Jack Henry and ASGN

0.59

Correlation Coefficient

Jack Henry  ASGN

Very weak diversification

The 3 months correlation between Jack and ASGN is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Jack Henry Associates and ASGN Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASGN Inc and Jack Henry 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 Jack Henry Associates are associated (or correlated) with ASGN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ASGN Inc has no effect on the direction of Jack Henry i.e., Jack Henry and ASGN go up and down completely randomly.

Pair Corralation between Jack Henry and ASGN

Given the investment horizon of 90 days Jack Henry Associates is expected to generate 0.46 times more return on investment than ASGN. However, Jack Henry Associates is 2.16 times less risky than ASGN. It trades about 0.02 of its potential returns per unit of risk. ASGN Inc is currently generating about -0.03 per unit of risk. If you would invest  17,248  in Jack Henry Associates on August 30, 2024 and sell it today you would earn a total of  148.00  from holding Jack Henry Associates or generate 0.86% return on investment over 90 days.

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

Jack Henry Associates  vs.  ASGN Inc

Jack Henry Associates

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Jack Henry Associates are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong technical indicators, Jack Henry is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

ASGN Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ASGN Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy technical and fundamental indicators, ASGN is not utilizing all of its potentials. The newest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Jack Henry and ASGN

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

The idea behind Jack Henry Associates and ASGN Inc 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.