Correlation Between Joy Global and Now

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Can any of the company-specific risk be diversified away by investing in both Joy Global and Now 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 Joy Global and Now into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Joy Global and Now Inc, you can compare the effects of market volatilities on Joy Global and Now 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 Joy Global with a short position of Now. Check out your portfolio center. Please also check ongoing floating volatility patterns of Joy Global and Now.

Diversification Opportunities for Joy Global and Now

0.0
  Correlation Coefficient

Pay attention - limited upside

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

Pair Corralation between Joy Global and Now

If you would invest  1,027  in Now Inc on December 29, 2023 and sell it today you would earn a total of  493.00  from holding Now Inc or generate 48.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.0%
ValuesDaily Returns

Joy Global  vs.  Now Inc

 Performance 
       Timeline  
Joy Global 

Risk-Adjusted Performance

0 of 100

 
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Very Weak
Over the last 90 days Joy Global has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Joy Global is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
Now Inc 

Risk-Adjusted Performance

12 of 100

 
Low
 
High
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Now Inc are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Now showed solid returns over the last few months and may actually be approaching a breakup point.

Joy Global and Now Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Joy Global and Now

The main advantage of trading using opposite Joy Global and Now positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Joy Global position performs unexpectedly, Now 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 Now will offset losses from the drop in Now's long position.
The idea behind Joy Global and Now Inc 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.

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