Correlation Between JD SPORTS and Air Transport
Can any of the company-specific risk be diversified away by investing in both JD SPORTS and Air Transport 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 JD SPORTS and Air Transport into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JD SPORTS FASH and Air Transport Services, you can compare the effects of market volatilities on JD SPORTS and Air Transport 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 JD SPORTS with a short position of Air Transport. Check out your portfolio center. Please also check ongoing floating volatility patterns of JD SPORTS and Air Transport.
Diversification Opportunities for JD SPORTS and Air Transport
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between 9JD and Air is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding JD SPORTS FASH and Air Transport Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air Transport Services and JD SPORTS 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 JD SPORTS FASH are associated (or correlated) with Air Transport. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Air Transport Services has no effect on the direction of JD SPORTS i.e., JD SPORTS and Air Transport go up and down completely randomly.
Pair Corralation between JD SPORTS and Air Transport
Assuming the 90 days horizon JD SPORTS FASH is expected to under-perform the Air Transport. In addition to that, JD SPORTS is 6.25 times more volatile than Air Transport Services. It trades about -0.08 of its total potential returns per unit of risk. Air Transport Services is currently generating about 0.07 per unit of volatility. If you would invest 2,120 in Air Transport Services on November 7, 2024 and sell it today you would earn a total of 20.00 from holding Air Transport Services or generate 0.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
JD SPORTS FASH vs. Air Transport Services
Performance |
| Timeline |
| JD SPORTS FASH |
| Air Transport Services |
JD SPORTS and Air Transport Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JD SPORTS and Air Transport
The main advantage of trading using opposite JD SPORTS and Air Transport positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JD SPORTS position performs unexpectedly, Air Transport 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 Air Transport will offset losses from the drop in Air Transport's long position.| JD SPORTS vs. NTT DATA | JD SPORTS vs. Gruppo Mutuionline SpA | JD SPORTS vs. DATADOT TECHNOLOGY | JD SPORTS vs. Fidelity National Information |
| Air Transport vs. MAGNUM MINING EXP | Air Transport vs. GALENA MINING LTD | Air Transport vs. ARDAGH METAL PACDL 0001 | Air Transport vs. East Africa Metals |
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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