Correlation Between JB Hunt and Golden Metal
Can any of the company-specific risk be diversified away by investing in both JB Hunt and Golden Metal 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 Golden Metal 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 Golden Metal Resources, you can compare the effects of market volatilities on JB Hunt and Golden Metal 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 Golden Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of JB Hunt and Golden Metal.
Diversification Opportunities for JB Hunt and Golden Metal
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between 0J71 and Golden is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding JB Hunt Transport and Golden Metal Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Metal Resources 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 Golden Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Metal Resources has no effect on the direction of JB Hunt i.e., JB Hunt and Golden Metal go up and down completely randomly.
Pair Corralation between JB Hunt and Golden Metal
Assuming the 90 days trading horizon JB Hunt Transport is expected to under-perform the Golden Metal. But the stock apears to be less risky and, when comparing its historical volatility, JB Hunt Transport is 1.51 times less risky than Golden Metal. The stock trades about -0.1 of its potential returns per unit of risk. The Golden Metal Resources is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 3,050 in Golden Metal Resources on October 9, 2024 and sell it today you would earn a total of 150.00 from holding Golden Metal Resources or generate 4.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 94.74% |
| Values | Daily Returns |
JB Hunt Transport vs. Golden Metal Resources
Performance |
| Timeline |
| JB Hunt Transport |
| Golden Metal Resources |
JB Hunt and Golden Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JB Hunt and Golden Metal
The main advantage of trading using opposite JB Hunt and Golden Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JB Hunt position performs unexpectedly, Golden Metal 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 Golden Metal will offset losses from the drop in Golden Metal's long position.| JB Hunt vs. Charter Communications Cl | JB Hunt vs. Europa Metals | JB Hunt vs. AMG Advanced Metallurgical | JB Hunt vs. Verizon Communications |
| Golden Metal vs. Compagnie Plastic Omnium | Golden Metal vs. Martin Marietta Materials | Golden Metal vs. STMicroelectronics NV | Golden Metal vs. Roadside Real Estate |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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