Correlation Between John B and Indofood Sukses
Can any of the company-specific risk be diversified away by investing in both John B and Indofood Sukses 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 Indofood Sukses 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 Indofood Sukses Makmur, you can compare the effects of market volatilities on John B and Indofood Sukses 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 Indofood Sukses. Check out your portfolio center. Please also check ongoing floating volatility patterns of John B and Indofood Sukses.
Diversification Opportunities for John B and Indofood Sukses
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between John and Indofood is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding John B Sanfilippo and Indofood Sukses Makmur in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Indofood Sukses Makmur 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 Indofood Sukses. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Indofood Sukses Makmur has no effect on the direction of John B i.e., John B and Indofood Sukses go up and down completely randomly.
Pair Corralation between John B and Indofood Sukses
Given the investment horizon of 90 days John B Sanfilippo is expected to under-perform the Indofood Sukses. But the stock apears to be less risky and, when comparing its historical volatility, John B Sanfilippo is 1.59 times less risky than Indofood Sukses. The stock trades about -0.01 of its potential returns per unit of risk. The Indofood Sukses Makmur is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 2,373 in Indofood Sukses Makmur on September 12, 2024 and sell it today you would earn a total of 301.00 from holding Indofood Sukses Makmur or generate 12.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.7% |
| Values | Daily Returns |
John B Sanfilippo vs. Indofood Sukses Makmur
Performance |
| Timeline |
| John B Sanfilippo |
| Indofood Sukses Makmur |
John B and Indofood Sukses Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with John B and Indofood Sukses
The main advantage of trading using opposite John B and Indofood Sukses positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John B position performs unexpectedly, Indofood Sukses 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 Indofood Sukses will offset losses from the drop in Indofood Sukses' long position.| John B vs. Lancaster Colony | John B vs. Treehouse Foods | John B vs. Seneca Foods Corp | John B vs. J J Snack |
| Indofood Sukses vs. BRF SA ADR | Indofood Sukses vs. Pilgrims Pride Corp | Indofood Sukses vs. John B Sanfilippo | Indofood Sukses 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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Other Complementary Tools
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| CEOs Directory Screen CEOs from public companies around the world |