Correlation Between JJ SNACK and SOFI TECHNOLOGIES
Can any of the company-specific risk be diversified away by investing in both JJ SNACK and SOFI TECHNOLOGIES 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 JJ SNACK and SOFI TECHNOLOGIES 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 SOFI TECHNOLOGIES, you can compare the effects of market volatilities on JJ SNACK and SOFI TECHNOLOGIES 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 JJ SNACK with a short position of SOFI TECHNOLOGIES. Check out your portfolio center. Please also check ongoing floating volatility patterns of JJ SNACK and SOFI TECHNOLOGIES.
Diversification Opportunities for JJ SNACK and SOFI TECHNOLOGIES
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between JJ1 and SOFI is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding JJ SNACK FOODS and SOFI TECHNOLOGIES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SOFI TECHNOLOGIES and JJ 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 SOFI TECHNOLOGIES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SOFI TECHNOLOGIES has no effect on the direction of JJ SNACK i.e., JJ SNACK and SOFI TECHNOLOGIES go up and down completely randomly.
Pair Corralation between JJ SNACK and SOFI TECHNOLOGIES
Assuming the 90 days trading horizon JJ SNACK FOODS is expected to generate 0.58 times more return on investment than SOFI TECHNOLOGIES. However, JJ SNACK FOODS is 1.74 times less risky than SOFI TECHNOLOGIES. It trades about -0.13 of its potential returns per unit of risk. SOFI TECHNOLOGIES is currently generating about -0.11 per unit of risk. If you would invest 14,400 in JJ SNACK FOODS on December 11, 2024 and sell it today you would lose (1,900) from holding JJ SNACK FOODS or give up 13.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
JJ SNACK FOODS vs. SOFI TECHNOLOGIES
Performance |
| Timeline |
| JJ SNACK FOODS |
| SOFI TECHNOLOGIES |
JJ SNACK and SOFI TECHNOLOGIES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JJ SNACK and SOFI TECHNOLOGIES
The main advantage of trading using opposite JJ SNACK and SOFI TECHNOLOGIES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JJ SNACK position performs unexpectedly, SOFI TECHNOLOGIES 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 SOFI TECHNOLOGIES will offset losses from the drop in SOFI TECHNOLOGIES's long position.| JJ SNACK vs. GOME Retail Holdings | JJ SNACK vs. Globe Trade Centre | JJ SNACK vs. CosmoSteel Holdings Limited | JJ SNACK vs. Indutrade AB |
| SOFI TECHNOLOGIES vs. Penta Ocean Construction Co | SOFI TECHNOLOGIES vs. Elmos Semiconductor SE | SOFI TECHNOLOGIES vs. Hitachi Construction Machinery | SOFI TECHNOLOGIES vs. 24SEVENOFFICE GROUP AB |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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