Correlation Between JB Hunt and RTW Venture
Can any of the company-specific risk be diversified away by investing in both JB Hunt and RTW Venture 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 RTW Venture 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 RTW Venture Fund, you can compare the effects of market volatilities on JB Hunt and RTW Venture 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 RTW Venture. Check out your portfolio center. Please also check ongoing floating volatility patterns of JB Hunt and RTW Venture.
Diversification Opportunities for JB Hunt and RTW Venture
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 0J71 and RTW is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding JB Hunt Transport and RTW Venture Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RTW Venture Fund 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 RTW Venture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RTW Venture Fund has no effect on the direction of JB Hunt i.e., JB Hunt and RTW Venture go up and down completely randomly.
Pair Corralation between JB Hunt and RTW Venture
Assuming the 90 days trading horizon JB Hunt is expected to generate 3.29 times less return on investment than RTW Venture. In addition to that, JB Hunt is 1.18 times more volatile than RTW Venture Fund. It trades about 0.02 of its total potential returns per unit of risk. RTW Venture Fund is currently generating about 0.06 per unit of volatility. If you would invest 115.00 in RTW Venture Fund on September 14, 2024 and sell it today you would earn a total of 28.00 from holding RTW Venture Fund or generate 24.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.16% |
| Values | Daily Returns |
JB Hunt Transport vs. RTW Venture Fund
Performance |
| Timeline |
| JB Hunt Transport |
| RTW Venture Fund |
JB Hunt and RTW Venture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JB Hunt and RTW Venture
The main advantage of trading using opposite JB Hunt and RTW Venture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JB Hunt position performs unexpectedly, RTW Venture 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 RTW Venture will offset losses from the drop in RTW Venture's long position.| JB Hunt vs. Nordic Semiconductor ASA | JB Hunt vs. Silvercorp Metals | JB Hunt vs. Jacquet Metal Service | JB Hunt vs. Elmos Semiconductor SE |
| RTW Venture vs. Ecclesiastical Insurance Office | RTW Venture vs. Central Asia Metals | RTW Venture vs. JB Hunt Transport | RTW Venture vs. Naked Wines plc |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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