Correlation Between Ecofin Global and JB Hunt
Can any of the company-specific risk be diversified away by investing in both Ecofin Global 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 Ecofin Global and JB Hunt into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ecofin Global Utilities and JB Hunt Transport, you can compare the effects of market volatilities on Ecofin Global 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 Ecofin Global with a short position of JB Hunt. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ecofin Global and JB Hunt.
Diversification Opportunities for Ecofin Global and JB Hunt
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ecofin and 0J71 is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Ecofin Global Utilities 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 Ecofin Global 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 Ecofin Global Utilities 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 Ecofin Global i.e., Ecofin Global and JB Hunt go up and down completely randomly.
Pair Corralation between Ecofin Global and JB Hunt
Assuming the 90 days trading horizon Ecofin Global Utilities is expected to generate 0.71 times more return on investment than JB Hunt. However, Ecofin Global Utilities is 1.41 times less risky than JB Hunt. It trades about 0.07 of its potential returns per unit of risk. JB Hunt Transport is currently generating about -0.01 per unit of risk. If you would invest 18,586 in Ecofin Global Utilities on November 4, 2024 and sell it today you would earn a total of 314.00 from holding Ecofin Global Utilities or generate 1.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Ecofin Global Utilities vs. JB Hunt Transport
Performance |
| Timeline |
| Ecofin Global Utilities |
| JB Hunt Transport |
Ecofin Global and JB Hunt Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ecofin Global and JB Hunt
The main advantage of trading using opposite Ecofin Global and JB Hunt positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ecofin Global 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.| Ecofin Global vs. McEwen Mining | Ecofin Global vs. Endeavour Mining Corp | Ecofin Global vs. Logitech International SA | Ecofin Global vs. Jacquet Metal Service |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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