Correlation Between AJ Bell and JSC National

Can any of the company-specific risk be diversified away by investing in both AJ Bell and JSC National 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 AJ Bell and JSC National into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between AJ Bell plc and JSC National Atomic, you can compare the effects of market volatilities on AJ Bell and JSC National 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 AJ Bell with a short position of JSC National. Check out your portfolio center. Please also check ongoing floating volatility patterns of AJ Bell and JSC National.

Diversification Opportunities for AJ Bell and JSC National

0.94

Correlation Coefficient

AJ Bell  JSC National

Almost no diversification

The 3 months correlation between AJB and JSC is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding AJ Bell plc and JSC National Atomic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JSC National Atomic and AJ Bell 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 AJ Bell plc are associated (or correlated) with JSC National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JSC National Atomic has no effect on the direction of AJ Bell i.e., AJ Bell and JSC National go up and down completely randomly.

Pair Corralation between AJ Bell and JSC National

Assuming the 90 days trading horizon AJ Bell is expected to generate 1.52 times less return on investment than JSC National. But when comparing it to its historical volatility, AJ Bell plc is 1.31 times less risky than JSC National. It trades about 0.25 of its potential returns per unit of risk. JSC National Atomic is currently generating about 0.29 of returns per unit of risk over similar time horizon. If you would invest  3,064  in JSC National Atomic on April 23, 2025 and sell it today you would earn a total of  1,311  from holding JSC National Atomic or generate 42.79% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	98.41%
Values	Daily Returns

AJ Bell plc  vs.  JSC National Atomic

AJ Bell plc

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in AJ Bell plc are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, AJ Bell exhibited solid returns over the last few months and may actually be approaching a breakup point.

JSC National Atomic

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in JSC National Atomic are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. Despite quite weak basic indicators, JSC National disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with AJ Bell and JSC National

The main advantage of trading using opposite AJ Bell and JSC National positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AJ Bell position performs unexpectedly, JSC National 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 JSC National will offset losses from the drop in JSC National's long position.

The idea behind AJ Bell plc and JSC National Atomic 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.