Correlation Between NetSol Technologies and Jacquet Metal

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

Diversification Opportunities for NetSol Technologies and Jacquet Metal

-0.37
  Correlation Coefficient

Very good diversification

The 3 months correlation between NetSol and Jacquet is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding NetSol Technologies 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 NetSol Technologies 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 NetSol Technologies 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 NetSol Technologies i.e., NetSol Technologies and Jacquet Metal go up and down completely randomly.

Pair Corralation between NetSol Technologies and Jacquet Metal

Given the investment horizon of 90 days NetSol Technologies is expected to generate 17.63 times less return on investment than Jacquet Metal. But when comparing it to its historical volatility, NetSol Technologies is 1.61 times less risky than Jacquet Metal. It trades about 0.01 of its potential returns per unit of risk. Jacquet Metal Service is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  1,644  in Jacquet Metal Service on September 10, 2022 and sell it today you would earn a total of  42.00  from holding Jacquet Metal Service or generate 2.55% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy95.65%
ValuesDaily Returns

NetSol Technologies  vs.  Jacquet Metal Service

 Performance (%) 
       Timeline  
NetSol Technologies 
NetSol Performance
0 of 100
Over the last 90 days NetSol Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in January 2023. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

NetSol Price Channel

Jacquet Metal Service 
Jacquet Performance
7 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Jacquet Metal Service are ranked lower than 7 (%) 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.

Jacquet Price Channel

NetSol Technologies and Jacquet Metal Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with NetSol Technologies and Jacquet Metal

The main advantage of trading using opposite NetSol Technologies and Jacquet Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NetSol Technologies 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.
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The idea behind NetSol Technologies 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.
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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 Watchlist Optimization module to optimize watchlists to build efficient portfolio or rebalance existing positions based on mean-variance optimization algorithm.

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