Correlation Between Hawkins and JD Sports
Can any of the company-specific risk be diversified away by investing in both Hawkins 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 Hawkins and JD Sports into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hawkins and JD Sports Fashion, you can compare the effects of market volatilities on Hawkins 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 Hawkins with a short position of JD Sports. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hawkins and JD Sports.
Diversification Opportunities for Hawkins and JD Sports
Very good diversification
The 3 months correlation between Hawkins and JDSPY is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Hawkins 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 Hawkins 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 Hawkins 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 Hawkins i.e., Hawkins and JD Sports go up and down completely randomly.
Pair Corralation between Hawkins and JD Sports
Given the investment horizon of 90 days Hawkins is expected to generate 0.58 times more return on investment than JD Sports. However, Hawkins is 1.74 times less risky than JD Sports. It trades about 0.19 of its potential returns per unit of risk. JD Sports Fashion is currently generating about -0.16 per unit of risk. If you would invest 11,699 in Hawkins on August 30, 2024 and sell it today you would earn a total of 1,640 from holding Hawkins or generate 14.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hawkins vs. JD Sports Fashion
Performance |
| Timeline |
| Hawkins |
| JD Sports Fashion |
Hawkins and JD Sports Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hawkins and JD Sports
The main advantage of trading using opposite Hawkins and JD Sports positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hawkins 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.| Hawkins vs. Perimeter Solutions SA | Hawkins vs. Kronos Worldwide | Hawkins vs. Sensient Technologies | Hawkins vs. Element Solutions |
| JD Sports vs. Burlington Stores | JD Sports vs. Childrens Place | JD Sports vs. Buckle Inc | JD Sports vs. Shoe Carnival |
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.
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