Correlation Between J JILL and RETAIL FOOD
Can any of the company-specific risk be diversified away by investing in both J JILL and RETAIL FOOD 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 J JILL and RETAIL FOOD into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between J JILL INC and RETAIL FOOD GROUP, you can compare the effects of market volatilities on J JILL and RETAIL FOOD 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 J JILL with a short position of RETAIL FOOD. Check out your portfolio center. Please also check ongoing floating volatility patterns of J JILL and RETAIL FOOD.
Diversification Opportunities for J JILL and RETAIL FOOD
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between 1MJ1 and RETAIL is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding J JILL INC and RETAIL FOOD GROUP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RETAIL FOOD GROUP and J JILL 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 J JILL INC are associated (or correlated) with RETAIL FOOD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RETAIL FOOD GROUP has no effect on the direction of J JILL i.e., J JILL and RETAIL FOOD go up and down completely randomly.
Pair Corralation between J JILL and RETAIL FOOD
Assuming the 90 days trading horizon J JILL INC is expected to under-perform the RETAIL FOOD. In addition to that, J JILL is 1.58 times more volatile than RETAIL FOOD GROUP. It trades about -0.06 of its total potential returns per unit of risk. RETAIL FOOD GROUP is currently generating about 0.09 per unit of volatility. If you would invest 3.80 in RETAIL FOOD GROUP on August 28, 2024 and sell it today you would earn a total of 0.40 from holding RETAIL FOOD GROUP or generate 10.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
J JILL INC vs. RETAIL FOOD GROUP
Performance |
| Timeline |
| J JILL INC |
| RETAIL FOOD GROUP |
J JILL and RETAIL FOOD Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with J JILL and RETAIL FOOD
The main advantage of trading using opposite J JILL and RETAIL FOOD positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if J JILL position performs unexpectedly, RETAIL FOOD 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 RETAIL FOOD will offset losses from the drop in RETAIL FOOD's long position.| J JILL vs. RETAIL FOOD GROUP | J JILL vs. Auto Trader Group | J JILL vs. AUTO TRADER ADR | J JILL vs. Canadian Utilities Limited |
| RETAIL FOOD vs. Apple Inc | RETAIL FOOD vs. Apple Inc | RETAIL FOOD vs. Apple Inc | RETAIL FOOD vs. Apple Inc |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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