Correlation Between Jerash Holdings and Carters
Can any of the company-specific risk be diversified away by investing in both Jerash Holdings and Carters 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 Jerash Holdings and Carters into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jerash Holdings US and Carters, you can compare the effects of market volatilities on Jerash Holdings and Carters 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 Jerash Holdings with a short position of Carters. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jerash Holdings and Carters.
Diversification Opportunities for Jerash Holdings and Carters
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Jerash and Carters is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Jerash Holdings US and Carters in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carters and Jerash Holdings 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 Jerash Holdings US are associated (or correlated) with Carters. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carters has no effect on the direction of Jerash Holdings i.e., Jerash Holdings and Carters go up and down completely randomly.
Pair Corralation between Jerash Holdings and Carters
Given the investment horizon of 90 days Jerash Holdings is expected to generate 2.05 times less return on investment than Carters. But when comparing it to its historical volatility, Jerash Holdings US is 1.05 times less risky than Carters. It trades about 0.07 of its potential returns per unit of risk. Carters is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 8,116 in Carters on December 30, 2023 and sell it today you would earn a total of 352.00 from holding Carters or generate 4.34% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Jerash Holdings US vs. Carters
Performance |
Timeline |
Jerash Holdings US |
Carters |
Jerash Holdings and Carters Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Jerash Holdings and Carters
The main advantage of trading using opposite Jerash Holdings and Carters positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jerash Holdings position performs unexpectedly, Carters 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 Carters will offset losses from the drop in Carters' long position.Jerash Holdings vs. Vince Holding Corp | Jerash Holdings vs. Figs Inc | Jerash Holdings vs. Delta Apparel | Jerash Holdings vs. Xcel Brands |
Carters vs. J Long Group Limited | Carters vs. Duluth Holdings | Carters vs. Destination XL Group | Carters vs. Victorias Secret Co |
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 AI Investment Finder module to use AI to screen and filter profitable investment opportunities.
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