Correlation Between JD Sports and Abingdon Health
Can any of the company-specific risk be diversified away by investing in both JD Sports and Abingdon Health 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 Abingdon Health 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 Abingdon Health Plc, you can compare the effects of market volatilities on JD Sports and Abingdon Health 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 Abingdon Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of JD Sports and Abingdon Health.
Diversification Opportunities for JD Sports and Abingdon Health
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between JD Sports and Abingdon is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding JD Sports Fashion and Abingdon Health Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Abingdon Health Plc 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 Abingdon Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Abingdon Health Plc has no effect on the direction of JD Sports i.e., JD Sports and Abingdon Health go up and down completely randomly.
Pair Corralation between JD Sports and Abingdon Health
Assuming the 90 days trading horizon JD Sports Fashion is expected to under-perform the Abingdon Health. But the stock apears to be less risky and, when comparing its historical volatility, JD Sports Fashion is 1.7 times less risky than Abingdon Health. The stock trades about 0.0 of its potential returns per unit of risk. The Abingdon Health Plc is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 650.00 in Abingdon Health Plc on September 20, 2024 and sell it today you would earn a total of 125.00 from holding Abingdon Health Plc or generate 19.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.8% |
| Values | Daily Returns |
JD Sports Fashion vs. Abingdon Health Plc
Performance |
| Timeline |
| JD Sports Fashion |
| Abingdon Health Plc |
JD Sports and Abingdon Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JD Sports and Abingdon Health
The main advantage of trading using opposite JD Sports and Abingdon Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JD Sports position performs unexpectedly, Abingdon Health 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 Abingdon Health will offset losses from the drop in Abingdon Health's long position.| JD Sports vs. Silver Bullet Data | JD Sports vs. Coeur Mining | JD Sports vs. Cairo Communication SpA | JD Sports vs. iShares Physical Silver |
| Abingdon Health vs. Ross Stores | Abingdon Health vs. JD Sports Fashion | Abingdon Health vs. Hochschild Mining plc | Abingdon Health vs. European Metals Holdings |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
Other Complementary Tools
| CEOs Directory Screen CEOs from public companies around the world | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Global Correlations Find global opportunities by holding instruments from different markets |