Correlation Between NetSol Technologies and JetAI

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

By analyzing existing cross correlation between NetSol Technologies and JetAI Inc, you can compare the effects of market volatilities on NetSol Technologies and JetAI 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 JetAI. Check out your portfolio center. Please also check ongoing floating volatility patterns of NetSol Technologies and JetAI.

Diversification Opportunities for NetSol Technologies and JetAI

-0.43

Correlation Coefficient

NetSol Technologies  JetAI

Very good diversification

The 3 months correlation between NetSol and JetAI is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding NetSol Technologies and JetAI Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JetAI Inc 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 JetAI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JetAI Inc has no effect on the direction of NetSol Technologies i.e., NetSol Technologies and JetAI go up and down completely randomly.

Pair Corralation between NetSol Technologies and JetAI

Given the investment horizon of 90 days NetSol Technologies is expected to generate 0.8 times more return on investment than JetAI. However, NetSol Technologies is 1.25 times less risky than JetAI. It trades about 0.32 of its potential returns per unit of risk. JetAI Inc is currently generating about -0.01 per unit of risk. If you would invest  238.00  in NetSol Technologies on May 1, 2025 and sell it today you would earn a total of  200.00  from holding NetSol Technologies or generate 84.03% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.39%
Values	Daily Returns

NetSol Technologies  vs.  JetAI Inc

NetSol Technologies

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in NetSol Technologies are ranked lower than 25 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting basic indicators, NetSol Technologies disclosed solid returns over the last few months and may actually be approaching a breakup point.

JetAI Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days JetAI Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, JetAI is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with NetSol Technologies and JetAI

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

The idea behind NetSol Technologies and JetAI 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.

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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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.