Correlation Between JD Sports and South Jersey
Can any of the company-specific risk be diversified away by investing in both JD Sports and South Jersey 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 South Jersey 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 South Jersey Industries, you can compare the effects of market volatilities on JD Sports and South Jersey 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 South Jersey. Check out your portfolio center. Please also check ongoing floating volatility patterns of JD Sports and South Jersey.
Diversification Opportunities for JD Sports and South Jersey
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between JDDSF and South is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding JD Sports Fashion and South Jersey Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on South Jersey Industries 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 South Jersey. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of South Jersey Industries has no effect on the direction of JD Sports i.e., JD Sports and South Jersey go up and down completely randomly.
Pair Corralation between JD Sports and South Jersey
If you would invest 6,745 in South Jersey Industries on October 25, 2024 and sell it today you would earn a total of 0.00 from holding South Jersey Industries or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 5.56% |
| Values | Daily Returns |
JD Sports Fashion vs. South Jersey Industries
Performance |
| Timeline |
| JD Sports Fashion |
| South Jersey Industries |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
JD Sports and South Jersey Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JD Sports and South Jersey
The main advantage of trading using opposite JD Sports and South Jersey positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JD Sports position performs unexpectedly, South Jersey 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 South Jersey will offset losses from the drop in South Jersey's long position.The idea behind JD Sports Fashion and South Jersey Industries pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| South Jersey vs. WK Kellogg Co | South Jersey vs. Bridgford Foods | South Jersey vs. Grocery Outlet Holding | South Jersey vs. Ainsworth Game Technology |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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