Correlation Between Jerash Holdings and Iconix Brand

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Can any of the company-specific risk be diversified away by investing in both Jerash Holdings and Iconix Brand 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 Iconix Brand 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 Iconix Brand Group, you can compare the effects of market volatilities on Jerash Holdings and Iconix Brand 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 Iconix Brand. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jerash Holdings and Iconix Brand.

Diversification Opportunities for Jerash Holdings and Iconix Brand

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  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Jerash and Iconix is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Jerash Holdings US and Iconix Brand Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Iconix Brand Group 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 Iconix Brand. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Iconix Brand Group has no effect on the direction of Jerash Holdings i.e., Jerash Holdings and Iconix Brand go up and down completely randomly.

Pair Corralation between Jerash Holdings and Iconix Brand

If you would invest (100.00) in Iconix Brand Group on December 29, 2023 and sell it today you would earn a total of  100.00  from holding Iconix Brand Group or generate -100.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.0%
ValuesDaily Returns

Jerash Holdings US  vs.  Iconix Brand Group

 Performance 
       Timeline  
Jerash Holdings US 

Risk-Adjusted Performance

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Over the last 90 days Jerash Holdings US has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Jerash Holdings is not utilizing all of its potentials. The newest stock price confusion, may contribute to short-horizon losses for the traders.
Iconix Brand Group 

Risk-Adjusted Performance

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Low
 
High
Very Weak
Over the last 90 days Iconix Brand Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Iconix Brand is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Jerash Holdings and Iconix Brand Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Jerash Holdings and Iconix Brand

The main advantage of trading using opposite Jerash Holdings and Iconix Brand positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jerash Holdings position performs unexpectedly, Iconix Brand 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 Iconix Brand will offset losses from the drop in Iconix Brand's long position.
The idea behind Jerash Holdings US and Iconix Brand Group 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.

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