Correlation Between JB Hunt and EJF Investments
Can any of the company-specific risk be diversified away by investing in both JB Hunt and EJF Investments 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 EJF Investments 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 EJF Investments, you can compare the effects of market volatilities on JB Hunt and EJF Investments 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 EJF Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of JB Hunt and EJF Investments.
Diversification Opportunities for JB Hunt and EJF Investments
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 0J71 and EJF is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding JB Hunt Transport and EJF Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EJF Investments 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 EJF Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EJF Investments has no effect on the direction of JB Hunt i.e., JB Hunt and EJF Investments go up and down completely randomly.
Pair Corralation between JB Hunt and EJF Investments
Assuming the 90 days trading horizon JB Hunt Transport is expected to under-perform the EJF Investments. In addition to that, JB Hunt is 1.15 times more volatile than EJF Investments. It trades about -0.14 of its total potential returns per unit of risk. EJF Investments is currently generating about 0.22 per unit of volatility. If you would invest 11,900 in EJF Investments on October 13, 2024 and sell it today you would earn a total of 650.00 from holding EJF Investments or generate 5.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.0% |
| Values | Daily Returns |
JB Hunt Transport vs. EJF Investments
Performance |
| Timeline |
| JB Hunt Transport |
| EJF Investments |
JB Hunt and EJF Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JB Hunt and EJF Investments
The main advantage of trading using opposite JB Hunt and EJF Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JB Hunt position performs unexpectedly, EJF Investments 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 EJF Investments will offset losses from the drop in EJF Investments' long position.| JB Hunt vs. Empire Metals Limited | JB Hunt vs. Liontrust Asset Management | JB Hunt vs. Wheaton Precious Metals | JB Hunt vs. Zurich Insurance Group |
| EJF Investments vs. Verizon Communications | EJF Investments vs. JB Hunt Transport | EJF Investments vs. Science in Sport | EJF Investments vs. Sartorius Stedim Biotech |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
Other Complementary Tools
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Stocks Directory Find actively traded stocks across global markets | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |