Correlation Between InPlay Oil and JJ SNACK
Can any of the company-specific risk be diversified away by investing in both InPlay Oil and JJ 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 InPlay Oil and JJ SNACK into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between InPlay Oil Corp and JJ SNACK FOODS, you can compare the effects of market volatilities on InPlay Oil and JJ 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 InPlay Oil with a short position of JJ SNACK. Check out your portfolio center. Please also check ongoing floating volatility patterns of InPlay Oil and JJ SNACK.
Diversification Opportunities for InPlay Oil and JJ SNACK
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between InPlay and JJ1 is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding InPlay Oil Corp 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 InPlay Oil 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 InPlay Oil Corp are associated (or correlated) with JJ 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 InPlay Oil i.e., InPlay Oil and JJ SNACK go up and down completely randomly.
Pair Corralation between InPlay Oil and JJ SNACK
Assuming the 90 days trading horizon InPlay Oil Corp is expected to under-perform the JJ SNACK. In addition to that, InPlay Oil is 1.64 times more volatile than JJ SNACK FOODS. It trades about -0.01 of its total potential returns per unit of risk. JJ SNACK FOODS is currently generating about 0.02 per unit of volatility. If you would invest 14,511 in JJ SNACK FOODS on August 30, 2024 and sell it today you would earn a total of 1,789 from holding JJ SNACK FOODS or generate 12.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
InPlay Oil Corp vs. JJ SNACK FOODS
Performance |
| Timeline |
| InPlay Oil Corp |
| JJ SNACK FOODS |
InPlay Oil and JJ SNACK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with InPlay Oil and JJ SNACK
The main advantage of trading using opposite InPlay Oil and JJ SNACK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if InPlay Oil position performs unexpectedly, JJ 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 JJ SNACK will offset losses from the drop in JJ SNACK's long position.| InPlay Oil vs. Carsales | InPlay Oil vs. GigaMedia | InPlay Oil vs. GRUPO CARSO A1 | InPlay Oil vs. Prosiebensat 1 Media |
| JJ SNACK vs. Iridium Communications | JJ SNACK vs. Hemisphere Energy Corp | JJ SNACK vs. SBA Communications Corp | JJ SNACK vs. Perseus Mining Limited |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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