Correlation Between JD Sports and GE Vernova
Can any of the company-specific risk be diversified away by investing in both JD Sports and GE Vernova 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 GE Vernova 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 GE Vernova LLC, you can compare the effects of market volatilities on JD Sports and GE Vernova 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 GE Vernova. Check out your portfolio center. Please also check ongoing floating volatility patterns of JD Sports and GE Vernova.
Diversification Opportunities for JD Sports and GE Vernova
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between JDSPY and GEV is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding JD Sports Fashion and GE Vernova LLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GE Vernova LLC 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 GE Vernova. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GE Vernova LLC has no effect on the direction of JD Sports i.e., JD Sports and GE Vernova go up and down completely randomly.
Pair Corralation between JD Sports and GE Vernova
Assuming the 90 days horizon JD Sports Fashion is expected to under-perform the GE Vernova. In addition to that, JD Sports is 1.31 times more volatile than GE Vernova LLC. It trades about 0.0 of its total potential returns per unit of risk. GE Vernova LLC is currently generating about 0.19 per unit of volatility. If you would invest 13,125 in GE Vernova LLC on September 3, 2024 and sell it today you would earn a total of 20,629 from holding GE Vernova LLC or generate 157.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 55.81% |
| Values | Daily Returns |
JD Sports Fashion vs. GE Vernova LLC
Performance |
| Timeline |
| JD Sports Fashion |
| GE Vernova LLC |
JD Sports and GE Vernova Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JD Sports and GE Vernova
The main advantage of trading using opposite JD Sports and GE Vernova positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JD Sports position performs unexpectedly, GE Vernova 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 GE Vernova will offset losses from the drop in GE Vernova's long position.| JD Sports vs. Burlington Stores | JD Sports vs. Childrens Place | JD Sports vs. Buckle Inc | JD Sports vs. Shoe Carnival |
| GE Vernova vs. Titan Machinery | GE Vernova vs. Asbury Automotive Group | GE Vernova vs. Ryanair Holdings PLC | GE Vernova vs. Lululemon Athletica |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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