Correlation Between JD SPORTS and Globex Mining
Can any of the company-specific risk be diversified away by investing in both JD SPORTS and Globex Mining 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 Globex Mining 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 Globex Mining Enterprises, you can compare the effects of market volatilities on JD SPORTS and Globex Mining 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 Globex Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of JD SPORTS and Globex Mining.
Diversification Opportunities for JD SPORTS and Globex Mining
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between 9JD and Globex is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding JD SPORTS FASH and Globex Mining Enterprises in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Globex Mining Enterprises 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 Globex Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Globex Mining Enterprises has no effect on the direction of JD SPORTS i.e., JD SPORTS and Globex Mining go up and down completely randomly.
Pair Corralation between JD SPORTS and Globex Mining
Assuming the 90 days horizon JD SPORTS FASH is expected to under-perform the Globex Mining. In addition to that, JD SPORTS is 1.93 times more volatile than Globex Mining Enterprises. It trades about -0.17 of its total potential returns per unit of risk. Globex Mining Enterprises is currently generating about 0.21 per unit of volatility. If you would invest 66.00 in Globex Mining Enterprises on September 5, 2024 and sell it today you would earn a total of 7.00 from holding Globex Mining Enterprises or generate 10.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
JD SPORTS FASH vs. Globex Mining Enterprises
Performance |
| Timeline |
| JD SPORTS FASH |
| Globex Mining Enterprises |
JD SPORTS and Globex Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JD SPORTS and Globex Mining
The main advantage of trading using opposite JD SPORTS and Globex Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JD SPORTS position performs unexpectedly, Globex Mining 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 Globex Mining will offset losses from the drop in Globex Mining's long position.| JD SPORTS vs. RYU Apparel | JD SPORTS vs. Titan Machinery | JD SPORTS vs. Granite Construction | JD SPORTS vs. AM EAGLE OUTFITTERS |
| Globex Mining vs. Penta Ocean Construction Co | Globex Mining vs. WIMFARM SA EO | Globex Mining vs. Chongqing Machinery Electric | Globex Mining vs. GALENA MINING LTD |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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