Correlation Between John B and Grupo Bimbo
Can any of the company-specific risk be diversified away by investing in both John B and Grupo Bimbo 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 John B and Grupo Bimbo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between John B Sanfilippo and Grupo Bimbo SAB, you can compare the effects of market volatilities on John B and Grupo Bimbo 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 John B with a short position of Grupo Bimbo. Check out your portfolio center. Please also check ongoing floating volatility patterns of John B and Grupo Bimbo.
Diversification Opportunities for John B and Grupo Bimbo
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between John and Grupo is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding John B Sanfilippo and Grupo Bimbo SAB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupo Bimbo SAB and John B 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 John B Sanfilippo are associated (or correlated) with Grupo Bimbo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupo Bimbo SAB has no effect on the direction of John B i.e., John B and Grupo Bimbo go up and down completely randomly.
Pair Corralation between John B and Grupo Bimbo
Given the investment horizon of 90 days John B Sanfilippo is expected to generate 0.9 times more return on investment than Grupo Bimbo. However, John B Sanfilippo is 1.11 times less risky than Grupo Bimbo. It trades about 0.16 of its potential returns per unit of risk. Grupo Bimbo SAB is currently generating about -0.15 per unit of risk. If you would invest 8,549 in John B Sanfilippo on September 13, 2024 and sell it today you would earn a total of 406.00 from holding John B Sanfilippo or generate 4.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
John B Sanfilippo vs. Grupo Bimbo SAB
Performance |
| Timeline |
| John B Sanfilippo |
| Grupo Bimbo SAB |
John B and Grupo Bimbo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with John B and Grupo Bimbo
The main advantage of trading using opposite John B and Grupo Bimbo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John B position performs unexpectedly, Grupo Bimbo 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 Grupo Bimbo will offset losses from the drop in Grupo Bimbo's long position.| John B vs. Lancaster Colony | John B vs. Treehouse Foods | John B vs. Seneca Foods Corp | John B vs. J J Snack |
| Grupo Bimbo vs. BRF SA ADR | Grupo Bimbo vs. Pilgrims Pride Corp | Grupo Bimbo vs. John B Sanfilippo | Grupo Bimbo vs. Seneca Foods Corp |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
Other Complementary Tools
| CEOs Directory Screen CEOs from public companies around the world | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data |