Correlation Between JERONIMO MARTINS and Jerónimo Martins
Can any of the company-specific risk be diversified away by investing in both JERONIMO MARTINS and Jerónimo Martins 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 JERONIMO MARTINS and Jerónimo Martins into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JERONIMO MARTINS UNADR2 and Jernimo Martins SGPS, you can compare the effects of market volatilities on JERONIMO MARTINS and Jerónimo Martins 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 JERONIMO MARTINS with a short position of Jerónimo Martins. Check out your portfolio center. Please also check ongoing floating volatility patterns of JERONIMO MARTINS and Jerónimo Martins.
Diversification Opportunities for JERONIMO MARTINS and Jerónimo Martins
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between JERONIMO and Jerónimo is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding JERONIMO MARTINS UNADR2 and Jernimo Martins SGPS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jernimo Martins SGPS and JERONIMO MARTINS 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 JERONIMO MARTINS UNADR2 are associated (or correlated) with Jerónimo Martins. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jernimo Martins SGPS has no effect on the direction of JERONIMO MARTINS i.e., JERONIMO MARTINS and Jerónimo Martins go up and down completely randomly.
Pair Corralation between JERONIMO MARTINS and Jerónimo Martins
Assuming the 90 days trading horizon JERONIMO MARTINS UNADR2 is expected to generate 0.98 times more return on investment than Jerónimo Martins. However, JERONIMO MARTINS UNADR2 is 1.02 times less risky than Jerónimo Martins. It trades about -0.02 of its potential returns per unit of risk. Jernimo Martins SGPS is currently generating about -0.03 per unit of risk. If you would invest 3,980 in JERONIMO MARTINS UNADR2 on August 31, 2024 and sell it today you would lose (360.00) from holding JERONIMO MARTINS UNADR2 or give up 9.05% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
JERONIMO MARTINS UNADR2 vs. Jernimo Martins SGPS
Performance |
| Timeline |
| JERONIMO MARTINS UNADR2 |
| Jernimo Martins SGPS |
JERONIMO MARTINS and Jerónimo Martins Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JERONIMO MARTINS and Jerónimo Martins
The main advantage of trading using opposite JERONIMO MARTINS and Jerónimo Martins positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JERONIMO MARTINS position performs unexpectedly, Jerónimo Martins 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 Jerónimo Martins will offset losses from the drop in Jerónimo Martins' long position.| JERONIMO MARTINS vs. Sysco | JERONIMO MARTINS vs. Jernimo Martins SGPS | JERONIMO MARTINS vs. Bunzl plc | JERONIMO MARTINS vs. Performance Food Group |
| Jerónimo Martins vs. Haverty Furniture Companies | Jerónimo Martins vs. DFS Furniture PLC | Jerónimo Martins vs. Tri Pointe Homes | Jerónimo Martins vs. Autohome ADR |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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