Correlation Between Empire Metals and JB Hunt
Can any of the company-specific risk be diversified away by investing in both Empire Metals and JB Hunt 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 Empire Metals and JB Hunt into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Empire Metals Limited and JB Hunt Transport, you can compare the effects of market volatilities on Empire Metals and JB Hunt 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 Empire Metals with a short position of JB Hunt. Check out your portfolio center. Please also check ongoing floating volatility patterns of Empire Metals and JB Hunt.
Diversification Opportunities for Empire Metals and JB Hunt
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Empire and 0J71 is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Empire Metals Limited and JB Hunt Transport in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JB Hunt Transport and Empire Metals 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 Empire Metals Limited are associated (or correlated) with JB Hunt. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JB Hunt Transport has no effect on the direction of Empire Metals i.e., Empire Metals and JB Hunt go up and down completely randomly.
Pair Corralation between Empire Metals and JB Hunt
Assuming the 90 days trading horizon Empire Metals Limited is expected to generate 2.59 times more return on investment than JB Hunt. However, Empire Metals is 2.59 times more volatile than JB Hunt Transport. It trades about 0.2 of its potential returns per unit of risk. JB Hunt Transport is currently generating about -0.21 per unit of risk. If you would invest 590.00 in Empire Metals Limited on September 13, 2024 and sell it today you would earn a total of 100.00 from holding Empire Metals Limited or generate 16.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Empire Metals Limited vs. JB Hunt Transport
Performance |
| Timeline |
| Empire Metals Limited |
| JB Hunt Transport |
Empire Metals and JB Hunt Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Empire Metals and JB Hunt
The main advantage of trading using opposite Empire Metals and JB Hunt positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Empire Metals position performs unexpectedly, JB Hunt 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 JB Hunt will offset losses from the drop in JB Hunt's long position.| Empire Metals vs. Givaudan SA | Empire Metals vs. Antofagasta PLC | Empire Metals vs. Ferrexpo PLC | Empire Metals vs. Atalaya Mining |
| JB Hunt vs. Empire Metals Limited | JB Hunt vs. McEwen Mining | JB Hunt vs. AMG Advanced Metallurgical | JB Hunt vs. GreenX Metals |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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