Correlation Between JetAI and Siriuspoint

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

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

Diversification Opportunities for JetAI and Siriuspoint

-0.7

Correlation Coefficient

JetAI  Siriuspoint

Excellent diversification

The 3 months correlation between JetAI and Siriuspoint is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding JetAI Inc and Siriuspoint in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siriuspoint and JetAI 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 JetAI Inc are associated (or correlated) with Siriuspoint. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siriuspoint has no effect on the direction of JetAI i.e., JetAI and Siriuspoint go up and down completely randomly.

Pair Corralation between JetAI and Siriuspoint

Given the investment horizon of 90 days JetAI Inc is expected to under-perform the Siriuspoint. In addition to that, JetAI is 5.03 times more volatile than Siriuspoint. It trades about -0.21 of its total potential returns per unit of risk. Siriuspoint is currently generating about 0.08 per unit of volatility. If you would invest  1,417  in Siriuspoint on September 14, 2024 and sell it today you would earn a total of  131.00  from holding Siriuspoint or generate 9.24% return on investment over 90 days.

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

JetAI Inc  vs.  Siriuspoint

JetAI Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days JetAI Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in January 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Siriuspoint

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Siriuspoint are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Siriuspoint may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with JetAI and Siriuspoint

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

The idea behind JetAI Inc and Siriuspoint 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.