Correlation Between CVS Health and J+J SNACK
Can any of the company-specific risk be diversified away by investing in both CVS Health and J+J SNACK 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 CVS Health and J+J SNACK into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CVS Health and JJ SNACK FOODS, you can compare the effects of market volatilities on CVS Health and J+J SNACK 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 CVS Health with a short position of J+J SNACK. Check out your portfolio center. Please also check ongoing floating volatility patterns of CVS Health and J+J SNACK.
Diversification Opportunities for CVS Health and J+J SNACK
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between CVS and J+J is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding CVS Health and JJ SNACK FOODS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JJ SNACK FOODS and CVS Health 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 CVS Health are associated (or correlated) with J+J SNACK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JJ SNACK FOODS has no effect on the direction of CVS Health i.e., CVS Health and J+J SNACK go up and down completely randomly.
Pair Corralation between CVS Health and J+J SNACK
Assuming the 90 days trading horizon CVS Health is expected to under-perform the J+J SNACK. In addition to that, CVS Health is 1.56 times more volatile than JJ SNACK FOODS. It trades about -0.01 of its total potential returns per unit of risk. JJ SNACK FOODS is currently generating about 0.03 per unit of volatility. If you would invest 14,699 in JJ SNACK FOODS on September 4, 2024 and sell it today you would earn a total of 1,601 from holding JJ SNACK FOODS or generate 10.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.66% |
| Values | Daily Returns |
CVS Health vs. JJ SNACK FOODS
Performance |
| Timeline |
| CVS Health |
| JJ SNACK FOODS |
CVS Health and J+J SNACK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CVS Health and J+J SNACK
The main advantage of trading using opposite CVS Health and J+J SNACK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CVS Health position performs unexpectedly, J+J SNACK 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 J+J SNACK will offset losses from the drop in J+J SNACK's long position.| CVS Health vs. TOTAL GABON | CVS Health vs. Walgreens Boots Alliance | CVS Health vs. Peak Resources Limited |
| J+J SNACK vs. Nestl SA | J+J SNACK vs. Kraft Heinz Co | J+J SNACK vs. General Mills | J+J SNACK vs. Kellogg Company |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Stocks Directory Find actively traded stocks across global markets | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. |