Correlation Between Jianpu Technology and Alphabet
Can any of the company-specific risk be diversified away by investing in both Jianpu Technology and Alphabet 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 Jianpu Technology and Alphabet into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jianpu Technology and Alphabet Class A, you can compare the effects of market volatilities on Jianpu Technology and Alphabet 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 Jianpu Technology with a short position of Alphabet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jianpu Technology and Alphabet.
Diversification Opportunities for Jianpu Technology and Alphabet
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Jianpu and Alphabet is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Jianpu Technology and Alphabet Class A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alphabet Class A and Jianpu Technology 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 Jianpu Technology are associated (or correlated) with Alphabet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alphabet Class A has no effect on the direction of Jianpu Technology i.e., Jianpu Technology and Alphabet go up and down completely randomly.
Pair Corralation between Jianpu Technology and Alphabet
Allowing for the 90-day total investment horizon Jianpu Technology is expected to under-perform the Alphabet. In addition to that, Jianpu Technology is 3.47 times more volatile than Alphabet Class A. It trades about -0.02 of its total potential returns per unit of risk. Alphabet Class A is currently generating about 0.09 per unit of volatility. If you would invest 10,472 in Alphabet Class A on December 30, 2023 and sell it today you would earn a total of 4,621 from holding Alphabet Class A or generate 44.13% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 89.52% |
Values | Daily Returns |
Jianpu Technology vs. Alphabet Class A
Performance |
Timeline |
Jianpu Technology |
Risk-Adjusted Performance
0 of 100
Low | High |
Very Weak
Alphabet Class A |
Jianpu Technology and Alphabet Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Jianpu Technology and Alphabet
The main advantage of trading using opposite Jianpu Technology and Alphabet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jianpu Technology position performs unexpectedly, Alphabet 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 Alphabet will offset losses from the drop in Alphabet's long position.Jianpu Technology vs. AssetMark Financial Holdings | Jianpu Technology vs. Philip Morris International | Jianpu Technology vs. PennantPark Floating Rate | Jianpu Technology vs. Rand Capital Corp |
Alphabet vs. Mustang Bio | Alphabet vs. InFintT Acquisition Corp | Alphabet vs. Uber Technologies | Alphabet vs. NETGEAR |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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