Correlation Between Summit Materials and Jacobs Engineering
Can any of the company-specific risk be diversified away by investing in both Summit Materials and Jacobs Engineering 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 Summit Materials and Jacobs Engineering into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Summit Materials and Jacobs Engineering Group, you can compare the effects of market volatilities on Summit Materials and Jacobs Engineering 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 Summit Materials with a short position of Jacobs Engineering. Check out your portfolio center. Please also check ongoing floating volatility patterns of Summit Materials and Jacobs Engineering.
Diversification Opportunities for Summit Materials and Jacobs Engineering
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Summit and Jacobs is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Summit Materials and Jacobs Engineering Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jacobs Engineering and Summit Materials 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 Summit Materials are associated (or correlated) with Jacobs Engineering. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jacobs Engineering has no effect on the direction of Summit Materials i.e., Summit Materials and Jacobs Engineering go up and down completely randomly.
Pair Corralation between Summit Materials and Jacobs Engineering
If you would invest (100.00) in Jacobs Engineering Group on February 2, 2024 and sell it today you would earn a total of 100.00 from holding Jacobs Engineering Group or generate -100.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 0.0% |
Values | Daily Returns |
Summit Materials vs. Jacobs Engineering Group
Performance |
Timeline |
Summit Materials |
Jacobs Engineering |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Summit Materials and Jacobs Engineering Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Summit Materials and Jacobs Engineering
The main advantage of trading using opposite Summit Materials and Jacobs Engineering positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Summit Materials position performs unexpectedly, Jacobs Engineering 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 Jacobs Engineering will offset losses from the drop in Jacobs Engineering's long position.Summit Materials vs. James Hardie Industries | Summit Materials vs. Loma Negra Compania | Summit Materials vs. Eagle Materials | Summit Materials vs. Cementos Pacasmayo SAA |
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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 Valuation module to check real value of public entities based on technical and fundamental data.
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