Correlation Between First Ship and JD Sports

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both First Ship and JD Sports 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 First Ship and JD Sports into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Ship Lease and JD Sports Fashion, you can compare the effects of market volatilities on First Ship and JD Sports 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 First Ship with a short position of JD Sports. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Ship and JD Sports.

Diversification Opportunities for First Ship and JD Sports

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between First and JDSPY is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding First Ship Lease and JD Sports Fashion in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JD Sports Fashion and First Ship 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 First Ship Lease are associated (or correlated) with JD Sports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JD Sports Fashion has no effect on the direction of First Ship i.e., First Ship and JD Sports go up and down completely randomly.

Pair Corralation between First Ship and JD Sports

If you would invest  4.00  in First Ship Lease on September 2, 2024 and sell it today you would earn a total of  0.00  from holding First Ship Lease or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy95.45%
ValuesDaily Returns

First Ship Lease  vs.  JD Sports Fashion

 Performance 
       Timeline  
First Ship Lease 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days First Ship Lease has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, First Ship is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.
JD Sports Fashion 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days JD Sports Fashion has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

First Ship and JD Sports Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with First Ship and JD Sports

The main advantage of trading using opposite First Ship and JD Sports positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Ship position performs unexpectedly, JD Sports 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 JD Sports will offset losses from the drop in JD Sports' long position.
The idea behind First Ship Lease and JD Sports Fashion pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.

Other Complementary Tools

Equity Search
Search for actively traded equities including funds and ETFs from over 30 global markets
Idea Analyzer
Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas
Economic Indicators
Top statistical indicators that provide insights into how an economy is performing
Technical Analysis
Check basic technical indicators and analysis based on most latest market data
Correlation Analysis
Reduce portfolio risk simply by holding instruments which are not perfectly correlated