Correlation Between Biglari Holdings and JBG SMITH
Can any of the company-specific risk be diversified away by investing in both Biglari Holdings and JBG SMITH 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 Biglari Holdings and JBG SMITH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Biglari Holdings and JBG SMITH Properties, you can compare the effects of market volatilities on Biglari Holdings and JBG SMITH 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 Biglari Holdings with a short position of JBG SMITH. Check out your portfolio center. Please also check ongoing floating volatility patterns of Biglari Holdings and JBG SMITH.
Diversification Opportunities for Biglari Holdings and JBG SMITH
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Biglari and JBG is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Biglari Holdings and JBG SMITH Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JBG SMITH Properties and Biglari Holdings 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 Biglari Holdings are associated (or correlated) with JBG SMITH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JBG SMITH Properties has no effect on the direction of Biglari Holdings i.e., Biglari Holdings and JBG SMITH go up and down completely randomly.
Pair Corralation between Biglari Holdings and JBG SMITH
Allowing for the 90-day total investment horizon Biglari Holdings is expected to generate 1.13 times less return on investment than JBG SMITH. In addition to that, Biglari Holdings is 1.33 times more volatile than JBG SMITH Properties. It trades about 0.03 of its total potential returns per unit of risk. JBG SMITH Properties is currently generating about 0.05 per unit of volatility. If you would invest 1,535 in JBG SMITH Properties on September 3, 2024 and sell it today you would earn a total of 174.00 from holding JBG SMITH Properties or generate 11.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Biglari Holdings vs. JBG SMITH Properties
Performance |
| Timeline |
| Biglari Holdings |
| JBG SMITH Properties |
Biglari Holdings and JBG SMITH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Biglari Holdings and JBG SMITH
The main advantage of trading using opposite Biglari Holdings and JBG SMITH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Biglari Holdings position performs unexpectedly, JBG SMITH 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 JBG SMITH will offset losses from the drop in JBG SMITH's long position.| Biglari Holdings vs. Highway Holdings Limited | Biglari Holdings vs. QCR Holdings | Biglari Holdings vs. Partner Communications | Biglari Holdings vs. Acumen Pharmaceuticals |
| JBG SMITH vs. Cousins Properties Incorporated | JBG SMITH vs. Highwoods Properties | JBG SMITH vs. Douglas Emmett | JBG SMITH vs. Equity Commonwealth |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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