Correlation Between JB Hunt and News Corp
Can any of the company-specific risk be diversified away by investing in both JB Hunt and News Corp 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 JB Hunt and News Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JB Hunt Transport and News Corp Cl, you can compare the effects of market volatilities on JB Hunt and News Corp 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 JB Hunt with a short position of News Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of JB Hunt and News Corp.
Diversification Opportunities for JB Hunt and News Corp
Very poor diversification
The 3 months correlation between 0J71 and News is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding JB Hunt Transport and News Corp Cl in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on News Corp Cl and JB Hunt 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 JB Hunt Transport are associated (or correlated) with News Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of News Corp Cl has no effect on the direction of JB Hunt i.e., JB Hunt and News Corp go up and down completely randomly.
Pair Corralation between JB Hunt and News Corp
Assuming the 90 days trading horizon JB Hunt is expected to generate 2.98 times less return on investment than News Corp. In addition to that, JB Hunt is 1.57 times more volatile than News Corp Cl. It trades about 0.06 of its total potential returns per unit of risk. News Corp Cl is currently generating about 0.29 per unit of volatility. If you would invest 2,742 in News Corp Cl on September 4, 2024 and sell it today you would earn a total of 236.00 from holding News Corp Cl or generate 8.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
JB Hunt Transport vs. News Corp Cl
Performance |
| Timeline |
| JB Hunt Transport |
| News Corp Cl |
JB Hunt and News Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JB Hunt and News Corp
The main advantage of trading using opposite JB Hunt and News Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JB Hunt position performs unexpectedly, News Corp 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 News Corp will offset losses from the drop in News Corp's long position.| JB Hunt vs. Samsung Electronics Co | JB Hunt vs. Samsung Electronics Co | JB Hunt vs. Hyundai Motor | JB Hunt vs. Toyota Motor Corp |
| News Corp vs. Evolution Gaming Group | News Corp vs. JB Hunt Transport | News Corp vs. Future Metals NL | News Corp vs. Golden Metal Resources |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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