Correlation Between J+J SNACK and SHIP HEALTHCARE
Can any of the company-specific risk be diversified away by investing in both J+J SNACK and SHIP HEALTHCARE 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 J+J SNACK and SHIP HEALTHCARE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JJ SNACK FOODS and SHIP HEALTHCARE HLDGINC, you can compare the effects of market volatilities on J+J SNACK and SHIP HEALTHCARE 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 J+J SNACK with a short position of SHIP HEALTHCARE. Check out your portfolio center. Please also check ongoing floating volatility patterns of J+J SNACK and SHIP HEALTHCARE.
Diversification Opportunities for J+J SNACK and SHIP HEALTHCARE
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between J+J and SHIP is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding JJ SNACK FOODS and SHIP HEALTHCARE HLDGINC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SHIP HEALTHCARE HLDGINC and J+J SNACK 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 JJ SNACK FOODS are associated (or correlated) with SHIP HEALTHCARE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SHIP HEALTHCARE HLDGINC has no effect on the direction of J+J SNACK i.e., J+J SNACK and SHIP HEALTHCARE go up and down completely randomly.
Pair Corralation between J+J SNACK and SHIP HEALTHCARE
Assuming the 90 days trading horizon JJ SNACK FOODS is expected to generate 0.67 times more return on investment than SHIP HEALTHCARE. However, JJ SNACK FOODS is 1.49 times less risky than SHIP HEALTHCARE. It trades about 0.27 of its potential returns per unit of risk. SHIP HEALTHCARE HLDGINC is currently generating about 0.04 per unit of risk. If you would invest 15,200 in JJ SNACK FOODS on September 4, 2024 and sell it today you would earn a total of 1,100 from holding JJ SNACK FOODS or generate 7.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
JJ SNACK FOODS vs. SHIP HEALTHCARE HLDGINC
Performance |
| Timeline |
| JJ SNACK FOODS |
| SHIP HEALTHCARE HLDGINC |
J+J SNACK and SHIP HEALTHCARE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with J+J SNACK and SHIP HEALTHCARE
The main advantage of trading using opposite J+J SNACK and SHIP HEALTHCARE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if J+J SNACK position performs unexpectedly, SHIP HEALTHCARE 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 SHIP HEALTHCARE will offset losses from the drop in SHIP HEALTHCARE's long position.| J+J SNACK vs. Nestl SA | J+J SNACK vs. Kraft Heinz Co | J+J SNACK vs. General Mills | J+J SNACK vs. Kellogg Company |
| SHIP HEALTHCARE vs. THRACE PLASTICS | SHIP HEALTHCARE vs. Rayonier Advanced Materials | SHIP HEALTHCARE vs. SANOK RUBBER ZY | SHIP HEALTHCARE vs. Gruppo Mutuionline SpA |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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