Correlation Between JD Sports and Hilton Food
Can any of the company-specific risk be diversified away by investing in both JD Sports and Hilton Food 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 Hilton Food 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 Hilton Food Group, you can compare the effects of market volatilities on JD Sports and Hilton Food 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 Hilton Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of JD Sports and Hilton Food.
Diversification Opportunities for JD Sports and Hilton Food
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between JD Sports and Hilton is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding JD Sports Fashion and Hilton Food Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hilton Food Group 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 Hilton Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hilton Food Group has no effect on the direction of JD Sports i.e., JD Sports and Hilton Food go up and down completely randomly.
Pair Corralation between JD Sports and Hilton Food
Assuming the 90 days trading horizon JD Sports Fashion is expected to under-perform the Hilton Food. In addition to that, JD Sports is 2.02 times more volatile than Hilton Food Group. It trades about -0.14 of its total potential returns per unit of risk. Hilton Food Group is currently generating about -0.07 per unit of volatility. If you would invest 89,300 in Hilton Food Group on November 30, 2024 and sell it today you would lose (3,800) from holding Hilton Food Group or give up 4.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
JD Sports Fashion vs. Hilton Food Group
Performance |
| Timeline |
| JD Sports Fashion |
| Hilton Food Group |
JD Sports and Hilton Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JD Sports and Hilton Food
The main advantage of trading using opposite JD Sports and Hilton Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JD Sports position performs unexpectedly, Hilton Food 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 Hilton Food will offset losses from the drop in Hilton Food's long position.| JD Sports vs. Prosiebensat 1 Media | JD Sports vs. Zoom Video Communications | JD Sports vs. Atresmedia | JD Sports vs. AcadeMedia AB |
| Hilton Food vs. Everyman Media Group | Hilton Food vs. Hollywood Bowl Group | Hilton Food vs. Zurich Insurance Group | Hilton Food vs. Clean Power Hydrogen |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments |