Correlation Between JD SPORTS and COMMERCIAL VEHICLE
Can any of the company-specific risk be diversified away by investing in both JD SPORTS and COMMERCIAL VEHICLE 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 COMMERCIAL VEHICLE 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 COMMERCIAL VEHICLE, you can compare the effects of market volatilities on JD SPORTS and COMMERCIAL VEHICLE 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 COMMERCIAL VEHICLE. Check out your portfolio center. Please also check ongoing floating volatility patterns of JD SPORTS and COMMERCIAL VEHICLE.
Diversification Opportunities for JD SPORTS and COMMERCIAL VEHICLE
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 9JD and COMMERCIAL is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding JD SPORTS FASH and COMMERCIAL VEHICLE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COMMERCIAL VEHICLE 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 COMMERCIAL VEHICLE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COMMERCIAL VEHICLE has no effect on the direction of JD SPORTS i.e., JD SPORTS and COMMERCIAL VEHICLE go up and down completely randomly.
Pair Corralation between JD SPORTS and COMMERCIAL VEHICLE
Assuming the 90 days horizon JD SPORTS FASH is expected to generate 0.96 times more return on investment than COMMERCIAL VEHICLE. However, JD SPORTS FASH is 1.04 times less risky than COMMERCIAL VEHICLE. It trades about 0.01 of its potential returns per unit of risk. COMMERCIAL VEHICLE is currently generating about -0.05 per unit of risk. If you would invest 139.00 in JD SPORTS FASH on September 4, 2024 and sell it today you would lose (17.00) from holding JD SPORTS FASH or give up 12.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.8% |
| Values | Daily Returns |
JD SPORTS FASH vs. COMMERCIAL VEHICLE
Performance |
| Timeline |
| JD SPORTS FASH |
| COMMERCIAL VEHICLE |
JD SPORTS and COMMERCIAL VEHICLE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JD SPORTS and COMMERCIAL VEHICLE
The main advantage of trading using opposite JD SPORTS and COMMERCIAL VEHICLE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JD SPORTS position performs unexpectedly, COMMERCIAL VEHICLE 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 COMMERCIAL VEHICLE will offset losses from the drop in COMMERCIAL VEHICLE's long position.| JD SPORTS vs. ASURE SOFTWARE | JD SPORTS vs. CyberArk Software | JD SPORTS vs. UPDATE SOFTWARE | JD SPORTS vs. Kaiser Aluminum |
| COMMERCIAL VEHICLE vs. TOTAL GABON | COMMERCIAL VEHICLE vs. Walgreens Boots Alliance | COMMERCIAL VEHICLE vs. Peak Resources 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. |