Correlation Between JB Hunt and Mitchells Butlers
Can any of the company-specific risk be diversified away by investing in both JB Hunt and Mitchells Butlers 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 Mitchells Butlers 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 Mitchells Butlers PLC, you can compare the effects of market volatilities on JB Hunt and Mitchells Butlers 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 Mitchells Butlers. Check out your portfolio center. Please also check ongoing floating volatility patterns of JB Hunt and Mitchells Butlers.
Diversification Opportunities for JB Hunt and Mitchells Butlers
-0.85 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between 0J71 and Mitchells is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding JB Hunt Transport and Mitchells Butlers PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mitchells Butlers PLC 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 Mitchells Butlers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mitchells Butlers PLC has no effect on the direction of JB Hunt i.e., JB Hunt and Mitchells Butlers go up and down completely randomly.
Pair Corralation between JB Hunt and Mitchells Butlers
Assuming the 90 days trading horizon JB Hunt is expected to generate 3.3 times less return on investment than Mitchells Butlers. In addition to that, JB Hunt is 1.1 times more volatile than Mitchells Butlers PLC. It trades about 0.01 of its total potential returns per unit of risk. Mitchells Butlers PLC is currently generating about 0.02 per unit of volatility. If you would invest 23,400 in Mitchells Butlers PLC on September 4, 2024 and sell it today you would earn a total of 1,150 from holding Mitchells Butlers PLC or generate 4.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 98.8% |
| Values | Daily Returns |
JB Hunt Transport vs. Mitchells Butlers PLC
Performance |
| Timeline |
| JB Hunt Transport |
| Mitchells Butlers PLC |
JB Hunt and Mitchells Butlers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JB Hunt and Mitchells Butlers
The main advantage of trading using opposite JB Hunt and Mitchells Butlers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JB Hunt position performs unexpectedly, Mitchells Butlers 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 Mitchells Butlers will offset losses from the drop in Mitchells Butlers' 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 |
| Mitchells Butlers vs. Samsung Electronics Co | Mitchells Butlers vs. Samsung Electronics Co | Mitchells Butlers vs. Hyundai Motor | Mitchells Butlers vs. Toyota Motor Corp |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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