Correlation Between Thermador Groupe and Jacquet Metal

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

By analyzing existing cross correlation between Thermador Groupe SA and Jacquet Metal Service, you can compare the effects of market volatilities on Thermador Groupe and Jacquet Metal 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 Thermador Groupe with a short position of Jacquet Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thermador Groupe and Jacquet Metal.

Diversification Opportunities for Thermador Groupe and Jacquet Metal

-0.33

Correlation Coefficient

Thermador Groupe  Jacquet Metal

Very good diversification

The 3 months correlation between Thermador and Jacquet is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Thermador Groupe SA and Jacquet Metal Service in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jacquet Metal Service and Thermador Groupe 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 Thermador Groupe SA are associated (or correlated) with Jacquet Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jacquet Metal Service has no effect on the direction of Thermador Groupe i.e., Thermador Groupe and Jacquet Metal go up and down completely randomly.

Pair Corralation between Thermador Groupe and Jacquet Metal

Assuming the 90 days trading horizon Thermador Groupe SA is expected to under-perform the Jacquet Metal. But the stock apears to be less risky and, when comparing its historical volatility, Thermador Groupe SA is 1.05 times less risky than Jacquet Metal. The stock trades about -0.21 of its potential returns per unit of risk. The Jacquet Metal Service is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  1,586  in Jacquet Metal Service on September 12, 2024 and sell it today you would earn a total of  74.00  from holding Jacquet Metal Service or generate 4.67% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	95.65%
Values	Daily Returns

Thermador Groupe SA  vs.  Jacquet Metal Service

Thermador Groupe

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Thermador Groupe SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Thermador Groupe is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Jacquet Metal Service

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Jacquet Metal Service are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Jacquet Metal sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Thermador Groupe and Jacquet Metal

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

The idea behind Thermador Groupe SA and Jacquet Metal Service 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.