Correlation Between Diamyd Medical and J+J SNACK
Can any of the company-specific risk be diversified away by investing in both Diamyd Medical 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 Diamyd Medical 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 Diamyd Medical AB and JJ SNACK FOODS, you can compare the effects of market volatilities on Diamyd Medical 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 Diamyd Medical with a short position of J+J SNACK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Diamyd Medical and J+J SNACK.
Diversification Opportunities for Diamyd Medical and J+J SNACK
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Diamyd and J+J is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Diamyd Medical AB 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 Diamyd Medical 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 Diamyd Medical AB 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 Diamyd Medical i.e., Diamyd Medical and J+J SNACK go up and down completely randomly.
Pair Corralation between Diamyd Medical and J+J SNACK
Assuming the 90 days horizon Diamyd Medical AB is expected to generate 3.0 times more return on investment than J+J SNACK. However, Diamyd Medical is 3.0 times more volatile than JJ SNACK FOODS. It trades about 0.32 of its potential returns per unit of risk. JJ SNACK FOODS is currently generating about -0.58 per unit of risk. If you would invest 130.00 in Diamyd Medical AB on October 12, 2024 and sell it today you would earn a total of 26.00 from holding Diamyd Medical AB or generate 20.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.44% |
| Values | Daily Returns |
Diamyd Medical AB vs. JJ SNACK FOODS
Performance |
| Timeline |
| Diamyd Medical AB |
| JJ SNACK FOODS |
Diamyd Medical and J+J SNACK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Diamyd Medical and J+J SNACK
The main advantage of trading using opposite Diamyd Medical and J+J SNACK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Diamyd Medical 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.| Diamyd Medical vs. TOWNSQUARE MEDIA INC | Diamyd Medical vs. PENN Entertainment | Diamyd Medical vs. GOODYEAR T RUBBER | Diamyd Medical vs. Ubisoft Entertainment SA |
| J+J SNACK vs. Townsquare Media | J+J SNACK vs. Commonwealth Bank of | J+J SNACK vs. SUN LIFE FINANCIAL | J+J SNACK vs. CanSino Biologics |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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