Correlation Between Jutal Offshore and 632525AW1

Can any of the company-specific risk be diversified away by investing in both Jutal Offshore and 632525AW1 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 Jutal Offshore and 632525AW1 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Jutal Offshore Oil and NAB 2648 14 JAN 41, you can compare the effects of market volatilities on Jutal Offshore and 632525AW1 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 Jutal Offshore with a short position of 632525AW1. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jutal Offshore and 632525AW1.

Diversification Opportunities for Jutal Offshore and 632525AW1

0.19

Correlation Coefficient

Jutal Offshore  632525AW1

Average diversification

The 3 months correlation between Jutal and 632525AW1 is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Jutal Offshore Oil and NAB 2648 14 JAN 41 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NAB 2648 14 and Jutal Offshore 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 Jutal Offshore Oil are associated (or correlated) with 632525AW1. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NAB 2648 14 has no effect on the direction of Jutal Offshore i.e., Jutal Offshore and 632525AW1 go up and down completely randomly.

Pair Corralation between Jutal Offshore and 632525AW1

Assuming the 90 days horizon Jutal Offshore Oil is expected to generate 0.03 times more return on investment than 632525AW1. However, Jutal Offshore Oil is 33.13 times less risky than 632525AW1. It trades about -0.18 of its potential returns per unit of risk. NAB 2648 14 JAN 41 is currently generating about -0.24 per unit of risk. If you would invest  1,917  in Jutal Offshore Oil on September 20, 2024 and sell it today you would lose (12.00) from holding Jutal Offshore Oil or give up 0.63% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	45.31%
Values	Daily Returns

Jutal Offshore Oil  vs.  NAB 2648 14 JAN 41

Jutal Offshore Oil

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Jutal Offshore Oil has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Jutal Offshore is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

NAB 2648 14

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days NAB 2648 14 JAN 41 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Bond's basic indicators remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for NAB 2648 14 JAN 41 investors.

Pair Trading with Jutal Offshore and 632525AW1

The main advantage of trading using opposite Jutal Offshore and 632525AW1 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jutal Offshore position performs unexpectedly, 632525AW1 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 632525AW1 will offset losses from the drop in 632525AW1's long position.

The idea behind Jutal Offshore Oil and NAB 2648 14 JAN 41 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.

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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.