Correlation Between JD Sports and Trugolf
Can any of the company-specific risk be diversified away by investing in both JD Sports and Trugolf 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 Trugolf 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 Trugolf, you can compare the effects of market volatilities on JD Sports and Trugolf 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 Trugolf. Check out your portfolio center. Please also check ongoing floating volatility patterns of JD Sports and Trugolf.
Diversification Opportunities for JD Sports and Trugolf
Very poor diversification
The 3 months correlation between JDSPY and Trugolf is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding JD Sports Fashion and Trugolf in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trugolf 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 Trugolf. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trugolf has no effect on the direction of JD Sports i.e., JD Sports and Trugolf go up and down completely randomly.
Pair Corralation between JD Sports and Trugolf
Assuming the 90 days horizon JD Sports Fashion is expected to under-perform the Trugolf. But the pink sheet apears to be less risky and, when comparing its historical volatility, JD Sports Fashion is 1.18 times less risky than Trugolf. The pink sheet trades about -0.05 of its potential returns per unit of risk. The Trugolf is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest 49.00 in Trugolf on September 13, 2024 and sell it today you would lose (5.00) from holding Trugolf or give up 10.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
JD Sports Fashion vs. Trugolf
Performance |
| Timeline |
| JD Sports Fashion |
| Trugolf |
JD Sports and Trugolf Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JD Sports and Trugolf
The main advantage of trading using opposite JD Sports and Trugolf positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JD Sports position performs unexpectedly, Trugolf 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 Trugolf will offset losses from the drop in Trugolf's long position.| JD Sports vs. Burlington Stores | JD Sports vs. Childrens Place | JD Sports vs. Buckle Inc | JD Sports vs. Shoe Carnival |
| Trugolf vs. Lindblad Expeditions Holdings | Trugolf vs. JD Sports Fashion | Trugolf vs. Evolution Gaming Group | Trugolf vs. Contagious Gaming |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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