Correlation Between J W and Leju Holdings

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

By analyzing existing cross correlation between J W Mays and Leju Holdings Limited, you can compare the effects of market volatilities on J W and Leju Holdings 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 J W with a short position of Leju Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of J W and Leju Holdings.

Diversification Opportunities for J W and Leju Holdings

-0.18

Correlation Coefficient

J W  Leju Holdings

Good diversification

The 3 months correlation between MAYS and Leju is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding J W Mays and Leju Holdings Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Leju Holdings Limited and J W 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 J W Mays are associated (or correlated) with Leju Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Leju Holdings Limited has no effect on the direction of J W i.e., J W and Leju Holdings go up and down completely randomly.

Pair Corralation between J W and Leju Holdings

If you would invest  207.00  in Leju Holdings Limited on September 5, 2024 and sell it today you would earn a total of  0.00  from holding Leju Holdings Limited or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	4.55%
Values	Daily Returns

J W Mays  vs.  Leju Holdings Limited

J W Mays

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days J W Mays has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Leju Holdings Limited

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Leju Holdings Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable forward-looking indicators, Leju Holdings is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with J W and Leju Holdings

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

The idea behind J W Mays and Leju Holdings Limited 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.