Correlation Between JD Sports and Grieg Seafood
Can any of the company-specific risk be diversified away by investing in both JD Sports and Grieg Seafood 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 JD Sports and Grieg Seafood into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JD Sports Fashion and Grieg Seafood, you can compare the effects of market volatilities on JD Sports and Grieg Seafood 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 JD Sports with a short position of Grieg Seafood. Check out your portfolio center. Please also check ongoing floating volatility patterns of JD Sports and Grieg Seafood.
Diversification Opportunities for JD Sports and Grieg Seafood
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between JD Sports and Grieg is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding JD Sports Fashion and Grieg Seafood in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grieg Seafood and JD Sports 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 JD Sports Fashion are associated (or correlated) with Grieg Seafood. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grieg Seafood has no effect on the direction of JD Sports i.e., JD Sports and Grieg Seafood go up and down completely randomly.
Pair Corralation between JD Sports and Grieg Seafood
Assuming the 90 days trading horizon JD Sports Fashion is expected to under-perform the Grieg Seafood. In addition to that, JD Sports is 1.73 times more volatile than Grieg Seafood. It trades about -0.21 of its total potential returns per unit of risk. Grieg Seafood is currently generating about 0.22 per unit of volatility. If you would invest 6,035 in Grieg Seafood on October 20, 2024 and sell it today you would earn a total of 450.00 from holding Grieg Seafood or generate 7.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
JD Sports Fashion vs. Grieg Seafood
Performance |
| Timeline |
| JD Sports Fashion |
| Grieg Seafood |
JD Sports and Grieg Seafood Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JD Sports and Grieg Seafood
The main advantage of trading using opposite JD Sports and Grieg Seafood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JD Sports position performs unexpectedly, Grieg Seafood 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 Grieg Seafood will offset losses from the drop in Grieg Seafood's long position.| JD Sports vs. Impax Asset Management | JD Sports vs. Flutter Entertainment PLC | JD Sports vs. Grieg Seafood | JD Sports vs. Centaur Media |
| Grieg Seafood vs. Cornish Metals | Grieg Seafood vs. Molson Coors Beverage | Grieg Seafood vs. Bankers Investment Trust | Grieg Seafood vs. Atalaya Mining |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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