Correlation Between JD SPORTS and Indorama Ventures
Can any of the company-specific risk be diversified away by investing in both JD SPORTS and Indorama Ventures 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 Indorama Ventures 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 Indorama Ventures PCL, you can compare the effects of market volatilities on JD SPORTS and Indorama Ventures 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 Indorama Ventures. Check out your portfolio center. Please also check ongoing floating volatility patterns of JD SPORTS and Indorama Ventures.
Diversification Opportunities for JD SPORTS and Indorama Ventures
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between 9JD and Indorama is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding JD SPORTS FASH and Indorama Ventures PCL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Indorama Ventures PCL 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 Indorama Ventures. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Indorama Ventures PCL has no effect on the direction of JD SPORTS i.e., JD SPORTS and Indorama Ventures go up and down completely randomly.
Pair Corralation between JD SPORTS and Indorama Ventures
Assuming the 90 days horizon JD SPORTS FASH is expected to under-perform the Indorama Ventures. But the stock apears to be less risky and, when comparing its historical volatility, JD SPORTS FASH is 1.68 times less risky than Indorama Ventures. The stock trades about -0.14 of its potential returns per unit of risk. The Indorama Ventures PCL is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 51.00 in Indorama Ventures PCL on September 12, 2024 and sell it today you would earn a total of 19.00 from holding Indorama Ventures PCL or generate 37.25% 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. Indorama Ventures PCL
Performance |
| Timeline |
| JD SPORTS FASH |
| Indorama Ventures PCL |
JD SPORTS and Indorama Ventures Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JD SPORTS and Indorama Ventures
The main advantage of trading using opposite JD SPORTS and Indorama Ventures positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JD SPORTS position performs unexpectedly, Indorama Ventures 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 Indorama Ventures will offset losses from the drop in Indorama Ventures' long position.| JD SPORTS vs. FAST RETAIL ADR | JD SPORTS vs. CCC SA | JD SPORTS vs. AOYAMA TRADING | JD SPORTS vs. Superior Plus Corp |
| Indorama Ventures vs. Fukuyama Transporting Co | Indorama Ventures vs. NTG Nordic Transport | Indorama Ventures vs. Ming Le Sports | Indorama Ventures vs. Big 5 Sporting |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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