Correlation Between SOFI TECHNOLOGIES and J+J SNACK
Can any of the company-specific risk be diversified away by investing in both SOFI TECHNOLOGIES and J+J SNACK 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 SOFI TECHNOLOGIES and J+J SNACK into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SOFI TECHNOLOGIES and JJ SNACK FOODS, you can compare the effects of market volatilities on SOFI TECHNOLOGIES and J+J SNACK 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 SOFI TECHNOLOGIES with a short position of J+J SNACK. Check out your portfolio center. Please also check ongoing floating volatility patterns of SOFI TECHNOLOGIES and J+J SNACK.
Diversification Opportunities for SOFI TECHNOLOGIES and J+J SNACK
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between SOFI and J+J is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding SOFI TECHNOLOGIES and JJ SNACK FOODS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JJ SNACK FOODS and SOFI TECHNOLOGIES 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 SOFI TECHNOLOGIES are associated (or correlated) with J+J SNACK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JJ SNACK FOODS has no effect on the direction of SOFI TECHNOLOGIES i.e., SOFI TECHNOLOGIES and J+J SNACK go up and down completely randomly.
Pair Corralation between SOFI TECHNOLOGIES and J+J SNACK
Assuming the 90 days horizon SOFI TECHNOLOGIES is expected to generate 1.11 times less return on investment than J+J SNACK. In addition to that, SOFI TECHNOLOGIES is 4.67 times more volatile than JJ SNACK FOODS. It trades about 0.03 of its total potential returns per unit of risk. JJ SNACK FOODS is currently generating about 0.15 per unit of volatility. If you would invest 15,724 in JJ SNACK FOODS on September 22, 2024 and sell it today you would earn a total of 276.00 from holding JJ SNACK FOODS or generate 1.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
SOFI TECHNOLOGIES vs. JJ SNACK FOODS
Performance |
| Timeline |
| SOFI TECHNOLOGIES |
| JJ SNACK FOODS |
SOFI TECHNOLOGIES and J+J SNACK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SOFI TECHNOLOGIES and J+J SNACK
The main advantage of trading using opposite SOFI TECHNOLOGIES and J+J SNACK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SOFI TECHNOLOGIES position performs unexpectedly, J+J SNACK 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 J+J SNACK will offset losses from the drop in J+J SNACK's long position.| SOFI TECHNOLOGIES vs. Apple Inc | SOFI TECHNOLOGIES vs. Apple Inc | SOFI TECHNOLOGIES vs. Apple Inc | SOFI TECHNOLOGIES vs. Apple Inc |
| J+J SNACK vs. Superior Plus Corp | J+J SNACK vs. SIVERS SEMICONDUCTORS AB | J+J SNACK vs. NorAm Drilling AS | J+J SNACK vs. Norsk Hydro ASA |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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