Correlation Between Ingredion Incorporated and JBS SA
Can any of the company-specific risk be diversified away by investing in both Ingredion Incorporated and JBS SA 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 Ingredion Incorporated and JBS SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ingredion Incorporated and JBS SA, you can compare the effects of market volatilities on Ingredion Incorporated and JBS SA 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 Ingredion Incorporated with a short position of JBS SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ingredion Incorporated and JBS SA.
Diversification Opportunities for Ingredion Incorporated and JBS SA
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ingredion and JBS is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Ingredion Incorporated and JBS SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JBS SA and Ingredion Incorporated 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 Ingredion Incorporated are associated (or correlated) with JBS SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JBS SA has no effect on the direction of Ingredion Incorporated i.e., Ingredion Incorporated and JBS SA go up and down completely randomly.
Pair Corralation between Ingredion Incorporated and JBS SA
Given the investment horizon of 90 days Ingredion Incorporated is expected to generate 1.72 times less return on investment than JBS SA. But when comparing it to its historical volatility, Ingredion Incorporated is 1.79 times less risky than JBS SA. It trades about 0.06 of its potential returns per unit of risk. JBS SA is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 678.00 in JBS SA on November 2, 2024 and sell it today you would earn a total of 526.00 from holding JBS SA or generate 77.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ingredion Incorporated vs. JBS SA
Performance |
| Timeline |
| Ingredion Incorporated |
| JBS SA |
Ingredion Incorporated and JBS SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ingredion Incorporated and JBS SA
The main advantage of trading using opposite Ingredion Incorporated and JBS SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ingredion Incorporated position performs unexpectedly, JBS SA 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 JBS SA will offset losses from the drop in JBS SA's long position.| Ingredion Incorporated vs. Lancaster Colony | Ingredion Incorporated vs. Treehouse Foods | Ingredion Incorporated vs. John B Sanfilippo | Ingredion Incorporated vs. Seneca Foods Corp |
| JBS SA vs. BRF SA ADR | JBS SA vs. Natures Sunshine Products | JBS SA vs. Marfrig Global Foods | JBS SA vs. Bridgford Foods |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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